The Levelized Cost of Electric Generation

Guest Post by Willis Eschenbach

In early 2013, the US Energy Information Agency (EIA) released their new figures for the “levelized cost” of new power plants. I just came across them, so I thought I’d pass them on. These are two years more recent than the same EIA cost estimates I discussed in 2011 here. Levelized cost is the average cost of power from a new generating plant over its entire lifetime of service. The use of levelized cost allows us to compare various energy sources on an even basis. Here are the levelized costs of power by fuel source, for plants with construction started now that would enter service in 2018:

us average levelized costs 2018Figure 1. The levelized cost of new power plants that would come on line in 2018. They are divided into dispatchable (blue bars, marked “D:”) and non-dispatchable power sources (gray bars, marked “N:”).

Now, there are two kinds of electric power sources. Power sources that you can call on at any time, day or night, are called “dispatchable”. These are shown in blue above, and include nuclear, geothermal, fossil fuel, and the like. They form the backbone of the generation mix.

On the other hand, intermittent power sources are called “non-dispatchable”. They include wind and solar. Hydro is an odd case, because typically, for part of the year it’s dispatchable, but in the dry season it may not be. Since it’s only seasonally dispatchable, I’ve put it with the non-dispatchable sources.

OK, first rule of the grid. You need to have as much dispatchable generation as is required by your most extreme load, and right then. The power grid is a jealous bitch, there’s not an iota of storage. When the demand rises, you have to meet it immediately, not in a half hour, or the system goes down. You need power sources that you can call on at any time.

You can’t depend on solar or wind for that, because it might not be there when you need it, and you get grid brownout or blackout. Non-dispatchable power doesn’t cut it for that purpose.

This means that if your demand goes up,  even if you’ve added non-dispatchable power sources like wind or solar to your generation mix, you still need to also add dispatchable power equal to the increased demand.

So there are two options. If the demand goes up, either you have to add more dispatchable power, or you can choose to add both more dispatchable power and more non-dispatchable power. Guess which one is more expensive …

And that, in turn means that the numbers above are deceptive—when demand goes up, as it always does, if you add a hundred megawatts of wind at $0.09 per kWh to the system, you also need to add a hundred megawatts of natural gas or geothermal or nuclear to the system.

As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there, so you’ll have dispatchable power when you need it. Otherwise, the electric power will go out, and you’ll have villagers with torches … and pitchforks …

Finally, I’m not sure I believe the maintenance figures in their report about wind. For solar, they put the price of overhead and maintenance at about one cent per kilowatt-hour. OK, that seems fair enough, there are no moving parts at all, just routine cleaning the dust off the panels.

But then, they say that the overhead and maintenance costs for wind are only one point three cents per kilowatt-hour, just 30% more than solar … sorry, that won’t wash. With wind, you have a multi-tonne complex piece of rapidly rotating machinery, sitting on a monstrous bearing way up on top of a huge pipe, with giant propellors attached to it, hanging out where the strongest winds blow. I’m not believing that the maintenance on that monstrosity will cost only 30% more than dusting photovoltaic panels …

Best to all,

w.

Usual Request: If you disagree with what I or someone else says, please QUOTE THE EXACT WORDS you disagree with. That allows everyone to understand exactly what you are objecting to.

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244 thoughts on “The Levelized Cost of Electric Generation

  1. Thank you Willis,
    The cost of free energy seems to come in at around three times the price of unfree energy.

  2. I am surprised that geothermal is so cheap. The plant operating in California near the Salton sea has horrendous maintenance problems with superheated brine that they have to use as a heat source. You also place coal with CCS slightly above coal. CCS has yet to be shown to work so how can theu know this figure?

  3. Of particular interest is a VERY well-written PhD thesis by Eleanor Denny, which can be found here:

    http://erc.ucd.ie/files/theses/Eleanor%20Denny%20-%20A%20Cost-Benefit%20Analysis%20of%20Wind%20Power.pdf

    In it she models the Irish Grid, and shows quite conclusively that the dispatchability problems with wind power (and by implication all of the renewable non-dispatchable sources result in an interesting phenomenon.

    A small amount of non-dispatchable power causes few problems to a grid, and is therefore of benefit. But when the amount of non-dispatchable power added to a grid is in excess of a certain percentage, the disadvantages start to outweigh the advantages, and eventually adding more non-dispatchable power produces a ‘negative benefit’ – in other words, you are worse off having the non-dispatchable power generation facility than you would be if it were shut down.

    The reason for this is that using non-dispatchable power forces dispatchable systems to either remain on standby, or to vary their output inefficiently to counteract the variability of the non-dispatchable power inputs. This creates inefficiency costs which eventually overwhelm the renewable benefits.

    The interesting point is where this ‘negative’ point occurs. Things start to slide when there is about 15% renewable on a grid, and by 25-30% the benefits are negative.

    This robust finding completely negates the plans to provide large percentages of renewable power to grids. Which is why you don’t hear much about this paper anywhere….

  4. Willis are the non-dispatchables calculated at nominal or real capacity? I think the UK has numbers for actual availability for wind at around 17-25% which would have considerable impact on writing off the capital investment during the alotted 25 year timeframe for a windmill installation. Equally solar has to be discounted at a <40% ability to deliver on sticker output due to weather/daylight availabilities.

    Secondly the minimum price of 7 ct/kWh for backup capacity would only apply to a plant that's already running. Power-ups and power-downs to meet spot demand is much more pricey due to non-optimal generation efficiency and increased maintenance costs and wear & tear.

  5. Wind turbine reliability statistics are not widely available, particularly for newer megawatt turbines. Most studies do not include newer larger turbine designs because the newer designs have fewer operational years and the failure rates are higher on the front end. What company wants to publicize that their turbine frequently breaks down after installation.

    “However, the group of megawatt WTs show a significantly higher failure rate, which also
    declines by increasing age. But, including now more and more mega-watt WT models of the newest generation, the failure rate in the first year of operation is being reduced.”

    http://www.researchgate.net/publication/205337678_Reliability_of_Wind_Turbines/file/3deec517c0f7157a68.pdf

    “Reported data may overestimate real availability and should be treated cautiously”

    http://www.nrel.gov/docs/fy13osti/59111.pdf

    The older the turbine the higher the maintenance costs- no kidding.

    http://windpower.sandia.gov/other/080983.pdf

    And who gets to pay for those higher maintenance costs? We the people!

  6. They use a capacity factor of 34% for onshore wind and 25% for solar PV both of which seem high.

    They also use 30% for natural gas fired conventional combustion turbine and 30% for natural gas fired advanced combustion. In other words they assume these plants will only be used 30% of the time. Presumably, this is because they assume that they will be used to fill in the gaps from the non-dispatchable sources. If they dumped the solar/wind and used these gas sources instead then the costs should more than halve.

  7. Not sure – either – how wind and hydro are equivalent in cost and as cheap as anything but combined gas. Seems like hydro is concentrated into just a few turbines and a condensed energy source with economies of scale. I’ve seen several reports of wind projects and existing fields abandoned due to cost , but hydros seem to only get put out for salmon.

    For all the other reasons noted, this EIA comparison has enough NOAA-style “homogenization” to be entirely misleading. Looks like more political battle prep.

  8. The levelised costs factor in a $15 per metric ton cost for coal and gas that don’t have carbon capture.

  9. “But then, they say that the overhead and maintenance costs for wind are only one point three cents per kilowatt-hour, just 30% more than solar … sorry, that won’t wash. With wind, you have a multi-tonne complex piece of rapidly rotating machinery, sitting on a monstrous bearing way up on top of a huge pipe, ”
    ————–

    A 1500-2500 + ton crane would be needed for work on the rotors, generate/ gearbox etc. In some cases a smaller crane (100 ton) is needed to start the lift and then the larger one finishes it. These cranes are NOT kept on site and may take days to weeks to get there, be assembled and do the job. Crane work is charged port to port, by the hour, and isn’t cheap. There are very few out there meaning days travel time and when it arrives, days to assemble, do the job, be disassembles and hauled back.

    I see rates at about 4,500 british pounds sterling/hr. ($7515 USD) and those are rental rates in the UK. A fully crewed union unit would be at least double to triple that IMHO. Here in the US, one would need to call for a quote.

  10. Thanks Willis …

    These prices actually look fairly close. Wind is cheap if you leverage a single line of technology and rationalize your maintenance and installs. As mentioned you have to cover non-dispatchable power with dispatchable power. There is another issue in that the renewables need massive upgrades to the transmission system. If I take my bill in a deregulated market … the transmission is about 35 to 40 percent of the bill. To accommodate renewables, the system operator is installing a 2 billion dollar upgrade in Alberta, Canada. From everything I’ve read the electrical transmission grid in the US is ill equipped to handle renewables. So if you look at my bill which is locked in at 0.08$/kwh with 0.06$/kwh for transmission and ancillaries, then looking out with the gas/wind mix coming and transmission upgrades, it is pretty conservative to say normalized power delivered to your door in North America will be around 0.2$/kwh in 2018. I have lived in an area where you needed air conditioning and with these prices in those areas, your power bill would get close to the average mortgage payment. I guess this is what regulators wanted, to push everyone into on site generation as there is in Honolulu where most roofs have solar panels on them. At what point do we all start installing gas reciprocating engines like some industrial customers (http://www.catpowerplants.com/Default). Maybe that’s not what the regulators wanted, shopping malls with on site thermal generation because of the degraded infrastructure and ‘all in’ cost of this ‘fuel mix’.

  11. Looks like Natural Gas Combined Cycle (gas-turbine and steam-generator making use of the excess left-over heat) is the way to go now.

    - cheapest cost;
    - natural gas reserves are large enough to last for many decades, and could extend for 100s of years given the new technological advances;
    - easy to transport natural gas through pipelines over long distances;
    - smaller plants can be built which loses less electricity through shorter transmission lines;
    - smaller plants and lower GHG emissions less likely to disturb the enviros;
    - more reliable supply than a grid system with renewables (might need more back-up systems if supplying smaller areas than large coal or hydro facilities which have excess capacity built-in);
    - long-term reliability and life-time of the plants is the issue outstanding.

  12. Mark Jacobson, who is arguably Stephen Schneider’s heir at Stanford, insists that adding 13,000 turbines in the waters off Long Island (which is part of Stanford’s master plan for turning New York State 100 percent wind, water, solar) will produce no added costs to consumers. He considers anyone who links wind, water, and solar (Stanford’s Greek chorus these days) to higher electricity costs to be grievously misinformed.

    So in love with wind is Jacobson that he is about to publish a peer-reviewed paper based on computer modeling indicating such offshore wind farms will meaningfully diminish the power of hurricanes as they approach the coast.

    I recently asked if he knows anyone on a fixed income who struggles to pay already high electricity bills. I received no answer. From a lofty moral elevation, however, he did deign to call a critique of mine of Stephen Schneider, based on his sliding honesty scale, “sad.”

    Thus, a self-appointed spokesman for “science,” one close to totally lacking any kind of practicality, uses new math to justify all manner of nonsense.

    As I argue in “Don’t Sell Your Coat,” such nonsense is liable to have grievous consequences if left unchecked.

  13. “There are two options”

    A third oprion is regular black-outs like 3rd world countries. (Or the Government can curtail your power for you when, in their wisdom, they don’t believe you need all of it.)

  14. Willis, there’s a few things in the EIA’s numbers that are simply not credible. First the capacity factors for wind. The EIA is projecting 34 and 37 per cent for onshore and offshore. This is simply not achievable. For example, Hydro-Quebec’s two wind generating complexes in Gaspe, an ideal location, never achieved better than 18 per cent during their first three years of operation, and have never exceeded 25 per cent.

    Second, the solar PV figure is not possible even in theory. Capacity factor is reduced by 50 per cent simply for diurnal variation. Winter insolation loss incurs at least another 15 per cent loss from lower sun angle. But the big one is cloud cover. Even light cloud cover reduces the amount of insolation by at least 80 per cent at the time of coverage. If you assume that 100 days per year will have cloud cover, that’s about another 25 per cent reduction. Leaving a reasonable annual capacity factor of about 10-12 per cent. Not the claimed 25 per cent.

    And we haven’t even included the loss of generation from snow cover, or air blown dust. The latter is particularly serious. Even the normal dust particles in the air produce significant deterioration of the PV cells from light surface scratching resulting in loss of generation from reflection and diffraction effects. After as little as five years, operational experience has shown a loss of as much as half of potential generation from this.

    John Marshall is entirely right, the CCS numbers are fantasy. It’s expected from the designs for CCS seen thus far that it will require at least 1/3 of total plant output to run the system.

    Also not included are higher O&M costs for all other forms of generation that must vary their output because of renewable load on the system. Varying thermal generation output rather than producing at constant value has significant adverse effect over time on steam and regulating systems in all thermal plants. One utility I know has to do at least 100 reactor “maneuvers” weekly just to compensate for sudden surges and drops in wind generation even where that wind generation is less than 10 per cent of total installed capacity on the grid.

    Finally, their variable O&M signficantly overstates the cost of nuclear fuel and signficantly understates the cost of coal or gas.

  15. Many states have a renewable portfolio standard. In order to meet that set percentage, you need 4-5 times as much wind capacity as the amount of power needed, since the capacity factors are so low. Even in Kansas, one of the best states for wind, the state only gives credit at about 10 percent of capacity toward meeting the renewable goals. This clearly ups the price of installed wind per (semi) reliable kilowatt hour.

  16. I had looked at the EIA estimates a number of times and had glossed over “dispatchable” and “non-dispatchable”. For reasons known to EIA, it looks like almost everything but variable generation (wind, solar, etc) is dispatchable. I suppose nuclear plants, coal plants and the big combined cycle plants are dispatched and have some load following capability, but when one comes off dispatch it’s a big deal. When the nukes come off dispatch, you get a press report. These units are also in a category known as base load.
    In Regional Transmission Organizations (grid control) the terms are base load for continuously running and dispatchable for those that operate to meet changing demand. Wind, solar and some other renewables, depending on contract, end up as base load.

    https://www.pjm.com/~/media/documents/manuals/m35.ashx

    The true dispatchables are the peaking plants, that really can be turned off and on as required for demand. (You aren’t going to get today’s power needs by cold starting a coal plant). These run under several regimes. Some do not run unless there is high (expensive electricity) demands. An oil fired peaker might run only when the price of electricity gets above $275/MWh, which is the cost of the oil to power most of them. Many of these get capacity payments–that is they are paid for not running based on arcane formulas. Some of the others run based on demand and/or bid in on the next day’s market predictions. They may also get capacity payments for being inactive.

    As Willis said, the grid is “jealous”. Demand for electricity is reflected in price. Price controls generation. It’s semi-capitalistic. We have regional control organizations that govern generation, set prices and make payments. The past few weeks have been an example of price and demand. Prices in much of the PJM (Pennsylvania-Jersey-Maryland) area which includes all or parts of NC, VA, PA, MD, DE, OH, WV, MI, NJ, KY, TN and DC, ran in the range of $750-$2500/MWh. Since my income is based on peaking plants, using renewable energy, operation, this period was pretty good. It beats the nice mild weather when the rates are i the $60/MWh range.

    I wonder how much of EIA’s crystal ball gazing is self-serving. That is to make politically correct forms of generation more palatable.

  17. wayne Job says:
    The cost of free energy seems to come in at around three times the price of unfree energy.

    That’s cheap at that price! In Britain we have calculated offshore wind turbine-generated electricity to be 24 times the price of coal-generated.

  18. CCS is expensive. Having done engineering on such facilities, the capture cost is somewhere north of $100 / tonne. Is this scale of number included in the CCS cases? It seems you have included $15 / tonne in the non-CCS, which would make me think the CCS ones are too low.

  19. Tom H says:
    February 16, 2014 at 6:03 am
    “There are two options”
    A third oprion is regular black-outs like 3rd world countries. (Or the Government can curtail your power for you when, in their wisdom, they don’t believe you need all of it.)

    Already planned, new meters being unstalled, at your expense of course, which can be remotely shut off by radio by the central agency. One could also have various means to decide who gets power and who gets shut off, like who you voted for, whether you have posted anything critical about the government on, say, this site, etc. And if that sounds paranoid, remember the military adage that says it is not about whether you think they will do it, but if they can do it, and they can right now. If they can, sooner or later they will be tempted… Example, the NSA and their ability to spy on everyone is tempted to use that spying for private purposes, and stories now circulate that inside sources say this has already occured.

    And, of course, it will be done by area, areas that politicians live in, the elite areas, will keep the lights on, the countryside, where the pheasants live, will not. Feudalism is returning.

  20. Problem #1: The U.S. Dept. of Energy put its big fat federal thumb on the scale.

    Down in the middle of the page it says, “In the AEO2013 reference case a 3-percentage point increase in the cost of capital is added when evaluating investments in greenhouse gas (GHG) intensive technologies like coal-fired power and coal-to-liquids (CTL) plants without carbon control and sequestration (CCS). While the 3-percentage point adjustment is somewhat arbitrary, in levelized cost terms its impact is similar to that of an emissions fee of $15 per metric ton of carbon dioxide (CO2) when investing in a new coal plant without CCS, similar to the costs used by utilities and regulators in their resource planning. The adjustment should not be seen as an increase in the actual cost of financing, but rather as representing the implicit hurdle being added to GHG-intensive projects to account for the possibility they may eventually have to purchase allowances or invest in other GHG emission-reducing projects that offset their emissions. As a result, the levelized capital costs of coal-fired plants without CCS are higher than would otherwise be expected.”

    In other words, they’ve added an arbitrary fudge factor to penalize coal for enhancing agricultural productivity.

    Problem #2: They used unrealistic cost recovery periods.

    The EIA page says, “The levelized cost shown for each utility-scale generation technology in the tables in this discussion are calculated based on a 30-year cost recovery period, using a real after tax weighted average cost of capital (WACC) of 6.6 percent. In reality, the cost recovery period and cost of capital can vary by technology and project type.”

    Does anyone really think wind turbines will last 30 years?

    Fortunately for Big Wind, they don’t have to. Among the many incentives the federal government offers for investment in Renewable Energy is a Modified (6-year) Accelerated Cost Recovery System (MACRS) Depreciation.

  21. For all the CCS doubters, the penalty is not as high as you’d think relative to ‘Clean Coal’ and you can go to the SaskPower symposium in Regina in October after they’ve run it a couple months. They are promising to have initial numbers on the economics. They’ve been tinkering with this idea for years and given they rebuilt the plant from the ground up (it’s not a pilot plant add on), I’d say this one won’t be cancelled last minute.

    It may yet prove not to be viable relative to ‘post fracking gas’ which didn’t exist when we went down this road (kind of frightening if you think about that) …. but with spot prices for ‘nat gas’ hitting 35$/GJ in producing areas recently … who knows. In the very least we are going to have to decide if we want to cover the landscape with wind mills and power lines or install pipe lines :D …

    http://business.financialpost.com/2014/02/14/saskpower-to-roll-out-worlds-first-ccs-embedded-power-plant/?__lsa=452d-5003

    There was also an interview with the CEO on BNN.

  22. AllenC says:
    February 16, 2014 at 6:34 am

    If Wind and Solar are so “cheap”, why do tax payers have to subsidize them??

    Exactly. And why the others are so heavily taxed?

    Also, Nuclear looks expensive. I thought It was cheaper.

  23. “Advanced” seems an odd tag for technology. The next generation of power engineers will probably get a good laugh.

  24. I”m not an expert on this, but I have read before that you can use solar farms to create gas, which is a despatch able source. So, in theory, you can build up a reservoir of gas before you ‘switch on’ the solar source, always maintaining a sufficient back up store of gas to make the source, in effect, despatchable.

    I’ve no knowledge about the economics of that but has that option been investigated in your data??

  25. Bob Green says “The true dispatchables are the peaking plants”

    You are right in that the true dispatchable units are peaking plants, especially those that provide ancillary capacitance and then ramp up from zero almost instantaneously (typically very small plants).

    However, all plants have a turn down and one thing not mentioned here is the initial install of wind generation in the MidWestern US destroyed a lot of coal plants which although equipped to move up and down, were never meant to move around in the way needed to off-set renewables. So in a regulated environment, there was a cost to wind generation that was just ignored … kind of like ignoring the cost a two footed driver has on your car.

    Having had to suffer an old coal plant through this new dispatch regime, I am assured the new 800-1000 MW natural gas stations will be highly dispatchable with a sizeable turn down.

    What I’m curious about as the power price normalizes to the price of burning Natural Gas plus efficiency losses, plus transmission, plus utility margins … how this plays out with many low efficiency plants being built as a hedge. My LED lighting might not be enough, I might have to properly install on site generation to mitigate the risk.

  26. cgh says, “a few things in the EIA’s numbers… are simply not credible. First the capacity factors for wind. The EIA is projecting 34 and 37 per cent for onshore and offshore. This is simply not achievable.”

    You’re right, cgh. The average capacity factor for all German wind turbines was only 17.5% in 2012.

    Additionally, 25% is an unrealistically optimistic number for solar PV capacity factor. Germany has the most solar generating capacity of any country in the world, but its 2012 average capacity factor was just 10.5%. An Arizona site might double that, but there’s no way they’ll get to 25%.

    Based on this 2012 report, the German nation-wide average wind capacity factor for 2012 was apparently just under 17.5% [45867 GWh/yr / (29.9 GW * 24 * 366) = 0.1746]. I.e., actual generated power was 17.5% of nameplate capacity, despite the fact that a lot of their windmills are pretty new, and electricity prices there are so extraordinarily high there (thanks to “green” politics) that there’s a strong incentive to keep the turbines well-maintained and running. Where electricity prices are lower, that incentive fades. I expect wind to blow, but that really sucks. Believe it or not, PV fared even worse — it’s average capacity factor in Germany in 2012 was only about 10.5%.

    Caveat: There’s a new 2013 version of that German report out, but I’ve not yet redone the arithmetic.

  27. I am suspicious of the hydro cost. It should be heavily dependent on the location, so a single average cost has no real meaning. Carter tried to kill the water projects when he came in out office, of course that was when oil was $10.

  28. drumphil says:
    February 16, 2014 at 6:37 am
    Most of the logic here is fine, but only if cost is the only thing that matters.
    ———————————————————————–
    What if traditional electricity costs 5c/kWhr and renewable costs 20c/kwHr. DId you ever think that maybe in that extra 15c/Kwhr that 6-8 cents of it is to produce energy to create the renewable energy? It is VERY likely that we are using more fossil fuels to produce renewable than we are traditional, it is just hidden in manufacturing in some unknown faraway land.

  29. Sorry Willis I don’t believe statistics generated by gob’mt apparatchiks. Over time I have found the newsletter “Access to Energy” most reliable. Maintenance on Wind Turbines must include the raptor and bat skeletons and blood of the 500K endangered species slaughtered by GE turbines.
    I’m no environchondriac but these devices do not engender economic sense. And it is cheap energy that makes an economy great.
    Chemical Engineering Chair, Lehigh University Professor John Chen, did an Energy Assessment for the globe some years ago. I suggest you read it because it stresses the importance of nuclear power. It implies we are wasting ENERGY & TIME on the alternative intellectual masturbations. It was written before the Balken and Marcellus NG finds. Available on his website or Lehigh’s.
    In my humble opinion we will always have plentiful natural carbon energy.

  30. I worked in power cost analysis for 25 years. Some may benefit from understanding that there are two different major components to power cost: fixed cost, and variable cost.

    Fixed cost relates to the plant, boilers, turbines, the personnel, the lights in the plant, etc. Fixed cost remains whether any electricity is produced at all.

    Variable cost is directly linked to energy production. It goes up and down with production. For example, the cost of coal burned is variable cost.

    PV solar and wind have a very high fixed cost, but zero variable cost.

    Beyond that, as len said, there is the additional consideration of transmission cost.

  31. “I’m not believing that the maintenance on that monstrosity will cost only 30% more than dusting photovoltaic panels …”
    You may be underestimating the cost of maintenance of solar farms Willis. Ahem-

    http://www.abakus-solar.us/blog/solar-farm-pv-power-plant-grounds-management-vegetation-control/

    Solar panels only output DC and the trend is for a micro-inverter on each panel so if one inverter goes down you don’t lose the output of many panels. Also inverters don’t last as long as the panels and so monitoring and replacement costs accrue.
    I don’t see any security with wind turbines but I wouldn’t want to leave my solar panels within easy reach of sticky fingers in remote locations would you?
    Not just a simple matter of dusting off the panels by all accounts-

    http://www.adelaidenow.com.au/news/south-australia/apy-solar-generator-lying-idle/story-e6frea83-1225999762268

  32. Rhys Jaggar says:
    February 16, 2014 at 6:59 am
    “I”m not an expert on this, but I have read before that you can use solar farms to create gas, which is a despatch able source. So, in theory, you can build up a reservoir of gas before you ‘switch on’ the solar source, always maintaining a sufficient back up store of gas to make the source, in effect, despatchable.
    I’ve no knowledge about the economics of that but has that option been investigated in your data??”

    Such devices get tested in Germany. They electrolyse water, produce SynGas and turn that into Methane. The losses are about 50%. Critics say, as long as NatGas is available, this is just a method to lose energy.
    In the graphic above, we should end up with 0.28 codt for energy produced via this detour.
    Taking into account the solar capacity factor in Germany (800 sunhours a year, a third of what the EIA used) we would arrive at 0.84 .

    It is probably still better than human slave labor.

  33. glenncz says, “What if traditional electricity costs 5c/kWhr and renewable costs 20c/kwHr.”

    Sorry, as I mentioned above. If we keep this fuel mix we are building out down to 20c/kwh in 2018, that would be fortunate. I would say 20% higher is likely and much higher possible.

  34. Directionally correct. Intermittents are not dispatchable by definition. But neither is base load that is run flat out all the time for cost and efficiency. All nuclear and newer supercritical coal are base load. Dispatchables include peaking gas turbines, spinning reserves (older less efficient coal) and theoretically CCGT (but much more efficient and less expensive if run as base load.
    The numbers are fudged with respect to capacity factor, especially solar. They are fudged with respect to lifetime. Supercritical coal is over 40, wind is under 20 due to gearbox failure ( and maintenance is understated). The results have been politicized.
    Willis’ point about having to add dispatchables to renewables in like proportion remains the biggest fudge of all.

  35. To really understand the build out of the grid, the Dispatchable sources need to be further subdivided into baseline and peaker units.

    Baseline sources such as nuclear and coal take days to weeks to bring on line from a cold plant and need to run as near to full capacity as possible to run efficiently.

    Peaker units can be taken on or off line in minutes.

    To keep the grid balanced, baseline capacity should not exceed minimum load.

  36. I cannot find the references now (so take this with huge grain of salt) but I thought I had read that the reason the wind mtx costs “look” so odd is due to how the mtx is contracted out.
    Also a lot of the end of life mtx costs are either born by the taxpayers during decommissioning or the units are just left standing and inoperative.
    so that MAY explain why those costs are so odd, because they are not true.

  37. Some of these numbers look a bit suspect to me.

    Nat gas power plans are typically intermediate and peaker capacity. Hence capacity factors around 25-50%, not 85%, are more common. I think this understates the cost of natural gas compared to coal. By the way, the last year has been characterized by gas to coal switching, ie, coal is gaining share.

    Nuclear cost seems understated. The overnight (if you could build the plant over night) cost is quite competitive for nuclear, but environment and legal challenges tend to make the construction period protracted, and financing costs tend to pile up. These can add 50% to capex–I don’t know if such costs are properly captured here, but they don’t seem to be.

    Hydro is a fantastic dispatchable resource. If can be turned on and off very quickly, although it does depend on adequate water in the respective reservoir. The EIA does note this in the footnotes, but hydro would ordinarily be considered a dispatchable resource. Also, hydro pairs very nicely with renewables, which are intermittent. Thus, when considering storage solutions for renewables, hydro is often presented as the preferred solution.

    Offshore wind costs look about right at 22 cents per kWh. However, the total capacity which could feasibly be installed on the east coast (really, the DC to Boston corridor) is about 12 GW, representing 2,000-3,000 turbines. I think, in terms of physical spacing and proximity to load centers, I think we’d be challenged to put even this many in the water, but it’s theoretically possible. You can find more on this in our report prepared for DOE, with specific modeling assumptions starting after page 164.

    http://energypolicy.columbia.edu/events-calendar/global-oil-market-forecasting-main-approaches-key-drivers

  38. Willis: “I’m not believing that the maintenance on that monstrosity will cost only 30% more than dusting photovoltaic panels”

    I agree and not only that cost, I’ve got one more fer ya that maybe hasn’t been figured in yet? Disaster/Mayhem/Doomsday insurance cost – (IF IT EXISTS??) Almost two years ago and ignored by MSM concerning a wind turbine erected near the north bank of the Mystic River (1000′s years of silt…) at the border of Everett and Charlestown, Mass:

    http://charlestownbridge.com/2012/03/08/mwra-insists-wind-turbine-is-in-perfect-order/

    1)”As reported last week, the new wind turbine in Charlestown has apparently sunk about 2 inches causing significant worry that the structural integrity of the 426,000 pound turbine is at risk.”

    2)”The blades for the turbine were produced in China and sent by boat to the US and off-loaded in Chelsea and then trucked to Charlestown.”

    As I see it, given that the MRWA was too stupid to pick an intelligent engineering firm to do the work correctly the first time – why should anyone believe they found an intelligent one to fix it?

    In the disaster/mayhem/doomsday department there is, just across the street, a (?) MW natural gas fired electric plant by National Grid, (used to be called the “Edison” plant). Having this behemoth fall over (1) onto the plant in a hurricane or having a Chinese blade fly off (2) and hit critical components of the power plant certainly meets my description.

    On top of that they erected it only a few hundred yards off the approach to Logan runway 15. With a maximum blade tip height (364 feet), and glide slope altitude at 2.5 miles away from “the numbers” of runway 15 about 700 feet. Not a lot of clearance either way IMO.

    Are wind turbines required to be underwritten for calamity and, if so, I wonder how the coverage amount is calculated?

    ————-
    Also -

    http://blog.aimnet.org/AIM-IssueConnect/bid/39814/Cape-Wind-Agreement-Adds-Burden-to-Massachusetts-Employers

    Supporting the EIA chart’s numbers concerning offshore wind power, back in 2010 National Grid agreed to pay 20.7 cents per KWH for power from the Cape Cod Cape Wind (which is still in limbo but will hopefully DIE a miserable death).

  39. You all realize that these “levelized cost” comparisons of competing types of electrical generation are misleading or meaningless due to government environmental mandates and regulations artificially driving up the operating costs of the dispatchable technologies while reducing the operating costs including financing of the non-dispatchable technologies. Remove the Obama EPA onerous and outrageous regulations on dispatchable technologies which drive up the costs, and wind solar etc become irrelevant.

  40. I work at a utility that just bought another 100MW of wind energy. It was $.024 per kWh fixed price for 20 years. That is a firm fixed price where the plant owner takes all of the risks, includes all maintenance costs, etc. The subsidies help get them down to this level from .07, and the site is a very good wind resource, very cheap land, no wheeling, but the other part of it is that the big wind suppliers (NextEra and Duke) are very competitive. They have sweetheart deal on GE turbines, have their own gearbox repair factories, etc.

    We’ve been working on permitting a new coal plant for about a decade now. It doesn’t look likely to ever get built. People laugh when you bring up nuclear.

    Your only real choices for new generation are wind and gas. You build gas to keep the lights on and you buy wind because it is state mandated, is a hedge against inflation, and may help contain the cost of production if gas prices go up. And you do everything in your power to keep your existing coal plants running forever, because they are your only source of fuel diversity and you’ll never be able to rebuild them.

  41. glenncz said:

    “It is VERY likely that we are using more fossil fuels to produce renewable than we are traditional, it is just hidden in manufacturing in some unknown faraway land.”

    Can you actually support that with solid figures? It takes a lot of work to figure such things out accurately. Can you point me at some decent papers that have dealt with this issue?

  42. Levelized costs are statistical lies devised to support particular policies. They are fundamentally subjective and deceptive. For example, the MIT study of nuclear power assumed a 40 year plant lifetime, which meant the levelized cost would be jacked up because the production benefits would be so much shorter. An 80 year plant lifetime would be more realistic (barring politically motivated closure). Also, wind and solar levelized costs ignore opportunity costs resulting from the vast amount of land required to be removed from other uses.

    A good discussion here. Read through to the modular reactors, e.g. NuScale. The author leaves out some very important features of modular reactors. They can be water cooled sitting in a pool with no circulating pumps or air cooled. They are thus 1000x safer than Gen 1 and 2 plants. The construction time is less than 1 year saving costs, and because the designs are identical, approval is faster. These features lead to far lower levelized costs.

    http://books.google.com/books?id=aJhKAgAAQBAJ&pg=PA107&lpg=PA107&dq=mit+levelized+cost+of+nuclear+power&source=bl&ots=9dw-jpEqZj&sig=cZ_gQ6IY6bCyFDxr2cS1nGEl78E&hl=en&sa=X&ei=oN4AU5SzOsvtoATmlYLQDw&ved=0CF4Q6AEwCQ#v=onepage&q=mit%20levelized%20cost%20of%20nuclear%20power&f=false

  43. Willis, a great article. It explains why my PG&E bill goes through the roof. Ant that’s exactly where warmists / warnists get their money. It would be nice to know how much of my extra electricity bill goes into pockets of Al Gore & Comp.

    I don’t have figures on increased demand on electricity. My gut feeling is that we are witnessing a replacement of cheap dispatchable generators by expensive intermittent generators. All according to a “green” plan.

  44. Also, I posted regarding fundamental problems with wind power a long time ago.

    http://wattsupwiththat.com/2011/02/13/the-futility-of-wind-power/#comment-598728

    In CA the Energy Commission has released 100m wind maps. We’ll get to that below. Each wind turbine uses 80 acres. That provides a 1/3 to 1/2 mile separation between turbines that occasionally disintegrate. The separation is needed to protect the neighboring turbines. I’ve posted this before, but here goes again:

    To provide 10% of power needs in CA would require 10,000 1.5 MW wind turbines. On 80 acres each, you need 1250 square miles of land. Except there isn’t enough land area with the required wind speeds (the CEC wind speed maps at 100m AGL). That means the turbines need to be built off shore. 1250 sq miles translates to 500 miles of coastline with 7 or so rows of turbines from the shore out to sea covering a band 2.5 miles wide.

    …click the link above for more…

  45. Willis, there is an additional problem with solar power that most people don’t realize. Solar PV is converted to AC via inverters. An inverter is unable to change the power factor to match the demand of the load the way a rotational generator will. Specifically, an inverter will on supply real power and no reactive power to the grid. Therefore, even when the PV is producing, you still need to install large reactors (big coils) to the system, or keep a large generator spinning to supply the reactive power to the grid.

    You say the power grid is a jealous bitch, and I agree. It is however the greatest machine ever built by man. The analogy I like to use is a thousand trains all traveling down parallel tracks, at the same speed, all connected by cables. If one slows down the rest have to pick up the load.

  46. Thanks for another very good article, Willis. You’ve also prompted some very knowledgeable people to respond in comments and that increases the value of your efforts.

  47. Re: Hoser says:
    February 16, 2014 at 8:04 am

    “levelized costs are statistical lies devised to support particular policies. They are fundamentally subjective and deceptive.”

    I agree absolutely. I dealt with such studies for 20 years and the results are easily made into almost any stack-up their author wishes. Levelized comparisons always include two variables that rely on projections; future fossil fuel costs and future reductions in alternate energy capital costs. Projected interest rates, construction times and dozens of other variables aside, those two “in the eye of the beholder” variables alone are a license to whopperdom.

    Anyone who seriously believes unsubsidized pv solar can ever get down to 14-cents per Kwh is smoking his or her own dope. If I gave you the solar cells for free, you couldn’t make that number.

  48. “I’m not believing that the maintenance on that monstrosity will cost only 30% more than dusting photovoltaic panels …”
    There is another cost not mention about wind turbines: tear down and replacement cost when the windmill burns up. Fire departments go down wind of the 300 foot torch and put out the sparks so the neighbor’s barn doesn’t burn down also..
    No partial recovery of anything, including the bolts holding the tower to the concrete base. Everything is scrap.
    Now no one has spoken of the emeshed in the scrap of rare earth substances unable to be recovered (hazardous waste) nor the toxic fumes from the fires blowin’ in the wind. But, we can leave that to another day..

  49. http://www.ft.com/cms/s/0/00eff456-3979-11e3-a3a4-00144feab7de.html#axzz2tVH5PW00

    “The agreement was reached after the government guaranteed a price of £92.50 per megawatt hour for electricity produced at Hinkley Point C in Somerset. This “strike price”, which is fully indexed to consumer price inflation, is roughly double the current price of power.”

    That’s 9.2 UK pennies per kWh, so not dollar cents It’s also given as the wholesale price , not consumer cost. So be careful when comparing to figures in this article.

    The point is the price of nuclear generated power has just been DOUBLED in the UK and it’s safely index linked.

    All other forms of energy have just become very competitive in the UK.

  50. You write: “As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there”

    I think that’s wrong. The costs you are listing, as I understand them, include both fixed and variable costs. If you need an extra unit of power and get it by adding one unit each of dispatchable and non-dispatchable, you are only going to run the dispatchable when the non isn’t producing, so it will be consuming less fuel than it would take if it were doing all the production, so the cost you have to add for it is less than your seven cents.

  51. After I stumbled on an article about a Gates investment going down the drain I was amazed to read that thanks to the shale revolution and the decline in power use in Texas had pushed the electricity price as low as $ 38,- per Mw = 10.000 Kw = $ 0,0038 cents per Kw (3Kw for $ 0,01.14)
    causing Gates power plant investment going belly up: http://www.zerohedge.com/news/2014-02-14/bill-gates-energy-co-files-bankruptcy#

    It shows some insights in the profits that are made over the backs of us poor suckers hooked at the grid although in Texas electricity prices are still very low compared to what Anthony pay’s in California and what I pay in Germany.

    http://www.electricityone.com

    One thing should be clear:

    We have to get rid of Government policies, programs, subsidies and market manipulations ASAP or we end up paying through our noses for our energy and lose our biosphere on the go as the morons have decided it would be a good idea to co-feed coal power plants with wood pallets to save the planet from humanity..

  52. David Friedman says:
    February 16, 2014 at 8:42 am

    You write: “As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there”

    I think that’s wrong. The costs you are listing, as I understand them, include both fixed and variable costs. If you need an extra unit of power and get it by adding one unit each of dispatchable and non-dispatchable, you are only going to run the dispatchable when the non isn’t producing, so it will be consuming less fuel than it would take if it were doing all the production, so the cost you have to add for it is less than your seven cents.

    =============================================================

    Supposition. Some may find it a better business decision to run the dispatchable all the time, and leave the non-dispatchable down. Building of non-dispatchable is government driven, not business driven.

  53. Willis, your classification of types of generators is not entirely correct. No generator which includes boiler tank is really dispatchable for a simple reason: it takes several hours to heat boiler for megawatt steam turbine to operational temperature from a cold shut. And it is very wasteful to keep it at operational temperature without fully loaded turbine at maximal capacity. So all generators with steam turbines – coal, nuclear or peat-fuelled – are always kept working at installation capacity except when they are shut down for planned repair and maintanance. Their combined capacity for given grid must be equal to the base load, while every additional power is generated using gas turbines. This is the only type of generator which can be switched on in minutes and operate at any required power without any additional fuel consumption. So, while fuel costs are much lower for coal, peat, nuclear or other generator with steam turbines, their capital costs of construction are much higher. The prices you cited include both fuel costs and construction costs divided to all power produced for all projected period of use under condition of full employment. This condition can be satisfied only when all base load is served by steam turbines and all peak load by natural gas turbines.

  54. …thanks Willis.

    the chart is pure fraud. wind and solar are much more expensive than that chart. if that chart were even remotely correct there would be no need of incentives of 60 to 80 cents a kilowatt for private enterprises to install solar or wind.

    THEY ARE LYING.

  55. ***
    Sergey says:
    February 16, 2014 at 8:56 am

    Willis, your classification of types of generators is not entirely correct. No generator which includes boiler tank is really dispatchable for a simple reason: it takes several hours to heat boiler for megawatt steam turbine to operational temperature from a cold shut. And it is very wasteful to keep it at operational temperature without fully loaded turbine at maximal capacity.
    ***

    Some capacity has to be run this way — obviously can’t run all units base-load all the time. Less economical/smaller units are run at low load at nite/weekends & full load day. Worked at a coal-fired plant that was often operated this way. The oldest unit was even brought down weekends & “bottled up” so retained a fair amount of heat & more quickly restarted — cut start-up time in half.

  56. drumphil (February 16, 2014 at 7:36 am)

    glenncz said: “It is VERY likely that we are using more fossil fuels to produce renewable than we are traditional, it is just hidden in manufacturing in some unknown faraway land.”
    Can you actually support that with solid figures? It takes a lot of work to figure such things out accurately. Can you point me at some decent papers that have dealt with this issue?

    The cost of a good is the cost of the energy plus labor and profit. Part of the labor cost is energy cost as well. This is especially true with products like solar panels from cheap labor countries like China. When buying panels we are really buying fossil fuels for mining, refining and production.

  57. David Friedman says, “so the cost you have to add for it is less than your seven cents”

    Gamecock replies, “Some may find it a better business decision to run the dispatchable all the time, and leave the non-dispatchable down.”

    So let me tell you how it really works in a ‘deregulated’ generation market in North America. In regulated markets, I would say the bias to wind is higher by ‘feed tariff’s and such.

    When the wind blows, the dispatchable power gets pushed off. If you are in the unfortunate situation where that is ‘old coal units’, then they go down to ‘min stable’ and get dispatched back up when the wind generation gets out of the way. Where there is dispatchable gas, it will be priced in with a price model that pushes the system to the marginal price of gas. Cogen is priced in at 0 because power is a byproduct. I’m sure Nuclear would be a price taker as well just taking what it gets. If portfolio bidding is allowed in a deregulated market, whether for system stability or capturing marginal price spikes, the net effect is to push the price up. In a regulated market, the feed tariffs and connection agreements do the same.

    The net effect is all power prices are being pushed to a bet against the natural gas price. So roughly 2 times the price of gas per GJ for the generation plus transmission plus 20% internal ROI. When nat gas gets back to 6$/GJ, that easily puts the power at a household’s meter to 20 cents/kwh. That is why where I live there is 4GW of gas generation in a 10GW market being planned to hold onto market share while we take the step change UP in price into this brave new world.

  58. I talked to a former employee of Weeks Marine, which is a huge marine barge, dredge, towing and construction company. He laughed out loud when I discussed the logistics of mounting several thousand large wind turbines in offshore Long Island. He simply said it couldn’t be done successfully at any price. Construction, maintenance, and logistics would eat up every last dime you threw at it, and would be never-ending.

  59. northernont says:

    February 16, 2014 at 7:29 am

    You all realize that these “levelized cost” comparisons of competing types of electrical generation are misleading or meaningless due to government environmental mandates and regulations artificially driving up the operating costs of the dispatchable technologies while reducing the operating costs including financing of the non-dispatchable technologies. Remove the Obama EPA onerous and outrageous regulations on dispatchable technologies which drive up the costs, and wind solar etc become irrelevant.
    _____________

    Correct.

  60. @ General P. Malaise says:
    February 16, 2014 at 9:08 am

    “http://www.wnd.com/2014/02/scientists-tricked-into-believing-this-lie/

    the above link is what is really at stake. climate change /warming / lies are all for one end. control.

    so while I appreciate WUWT and the fantastic science that is on display the real fight is for our freedom.

    cheers”

    How right you are.

    The time has come to fight back and clean House:

    http://www.washingtonsblog.com/2014/02/nothing-will-fixed-us-criminals-arrested-top-us-official.html

  61. Jsut a nitpik…

    Assumed utilization rate seriously impacts the levelized cost, also the delivered price of coal varies by 300 to 400% depending on region so a ‘national’ levelized cost for coal is pretty much meaningless information.

    What we need are levelized costs for baseload, intermediate load and peak load.

    I can pretty much tell without looking at construction costs that coal will come in very expensive in Florida and about as ‘cheap as dirt’ in Wyoming.

  62. Good post, thank you Willis.

    Repeating from previous posts:

    http://www.wind-watch.org/documents/wp-content/uploads/eonwindreport2005.pdf

    (apparently no longer available from E.ON Netz website).

    Re E.ON Netz Wind Report 2005 – see especially:

    Figure 6 says Wind Power does not work (need for ~100% spinning backup);

    and Figure 7 says it just gets worse and worse the more Wind Power you add to the grid (see Substitution Factor).

    Same story for grid-connected Solar Power (both in the absence of a “Super-Battery”).
    ___________

    From our 2002 paper at http://www.apegga.org/Members/Publications/peggs/WEB11_02/kyoto_pt.htm

    “The ultimate agenda of pro-Kyoto advocates is to eliminate fossil fuels, but this would result in a catastrophic shortfall in global energy supply – the wasteful, inefficient energy solutions proposed by Kyoto advocates simply cannot replace fossil fuels.”

    C’mon good people – try to keep up! :-)

  63. I find the wind number to be useless, as so many factors are site specific. Might as well rely on climate model projections. ;?p

  64. First problem : the cost of wind energy depends in large measure on the strength and availability
    of the wind. The more windmills there are, the less likely one will find good locations and windmills need LOTs of space. There is also talk of high maintenance costs, probably non-reported. Also, as pointed out, unreliable power generation incurs side effect costs – the need for backup
    generation. Only fuel is saved (usually, but not always) when dispatchable power is replaced
    by non-dispatchable power. But fuel costs are often the smallest portion of plant operation costs, especially these days with cheap gas prices and cheap nuclear fuel prices.
    California is trying to create power storage by building a half dozen or more pumped storage facilities up in the mountains to store their excessive wind and solar. There are problems : 1) the costs of these facilities is quite large – not much cheaper than a nuclear power plant 2) their output capacity is limited to a dozen hours at peak output (a gigwatt) – obviously these plants do not make solar or wind power dispatchable in the general sense- they mainly can displace power from one part of the day to another – if the wind dies for more than half a day, there will be no wind power available to the grid. Ditto for solar. 3) there is a significant penalty for storing the power in the pumped storage facilities – apparently about 30% of the power is lost in the process. That makes stored wind power about 30% more costly, apparently.
    My estimate of current build nuclear generation costs (assuming,conservatively, a lifespan of 60 years) is less than 5 cents. Fuel costs these days are less than 3/4 cents per kWhr and maintenance and ops costs are running 1.5 cents per kWhr in my state. My estimate of build costs (assuming the guaranteed 60 year lifespan of Gen 3 plants) is roughly 1 cent per kWhr. The land requirements are trivial – about 50 acres these days. Costs for nuclear waste disposal are 1/10th cent per kWhr and have been shown to be excessive- especially when fast nuclear reactors come online, which can burn nuclear wastes. I would love to see what cost component estimates were used for this study. I find it impossible to arrive at 11 cents per kWhr for Gen 3 plants, which are being built at roughly $4 to $5 billion per gigawatt. Try half that figure. Or less.

  65. Each reading this needs to look at the first link – http://www.eia.gov/forecasts/aeo/er/electricity_generation.cfm and read this and ther report and understand it and the facts that are missing.
    “Levelized cost is often cited as a convenient summary measure of the overall competiveness of different generating technologies. It represents the per-kilowatthour cost (in real dollars) of building and operating a generating plant over an assumed financial life and duty cycle”
    It is a hokus-pokus financial number that is used to decide if you should build a plant. It leaves out many important factors. As someone above mentioned NPP’s will normally run for 80 years – not 40 as in the analysis. Then, they use the manufacture’s warranty life for wind/solar, 25 years, yet to this date NONE have actually ever lasted that long, most don’t even last half of that 20-25 years. Then if you bought one, you are stuck with a massive repair bill which means it is usually cheaper to just replace it. Nuclear includes the cost of decommissioning, in most cases to better than as found conditions. Whereas all others do not. and the community is left with a rusting wind turbine or an abandoned solar farm. (Google them) At least coal plants and gas turbines will be torn down to avoid the higher property taxes, but the land will be just bulldozed to a semi-usable state – extensive work needed to re-use. They are also talking retail customer selling (electric bill) price NOT wholesale factory, industry price, which is typically about 1/2 that number – Except for Wind/solar as who is going to run a factory on either?
    But it does give the Greenies something to throw at you – when you don’t understand what the number is.

  66. My calculations are that a solar farm requires about 80,000 acres to produce the same gross amount of power as single nuclear plant of roughly 1500 Mw, operting at their usual 96% capacity. Windmills also require lots of land.
    So what are the cost estimates for those land compoments in this (apparently bogus) levelized power costs ?

  67. len says:
    February 16, 2014 at 6:44 am

    For all the CCS doubters, the penalty is not as high as you’d think relative to ‘Clean Coal’ and you can go to the SaskPower symposium in Regina in October after they’ve run it a couple months.

    Since SaskPower have no results yet, I’m unclear on the source of your confidence that the penalty is not high … a link to actual facts would be good.

    w.

  68. IN my research on small modular reactors, it is often claimed that they can produce power at 10 cents per kWhr, and further, that this is considerably more expensive than power from a conventional nuclear plant, reducing the likely applications to remote areas or smaller populated areas that don’t require a full sized nuclear plant. All this totally contradicts these levelized cost figures for nuclear supplied by the govt.

  69. Even the windmill meisters agree that unless you live in a very windy place, windmills aren’t cost competitive. (Probably not even then) So what happens when it becomes common knowledge that windmills are decimating our bat populations and possible exterminating our endangered Whooping Cranes and other birds ?

  70. Willis: Did you read far enough to discover that these figures arise from a massive economic model? The costs for various fuels appear to be projections for the quarter century after a new plant opens in 2018. There is no free market in electricity, so we really don’t know how electricity production really costs. The best one could do is find out how much distributors are actually paying generators today for electricity from various sources, add in the cost of the subsidies the generators receive and adjust for known improvements and current price changes.

    “This report presents the major assumptions of the National Energy Modeling System (NEMS) used to generate the projections in the Annual Energy Outlook 2013 [1] (AEO2013), including general features of the model structure, assumptions concerning energy markets, and the key input data and parameters that are the most significant in formulating the model results. Detailed documentation of the modeling system is available in a series of documentation reports.” http://www.eia.gov/forecasts/aeo/assumptions/

  71. “There are two options”
    The other option will soon be here: smart meters are being installed all across the USA (& soon in the UK). These will allow the grid controllers to switch homes partially or fully off when the renewables cannot cope and there is insufficient dispatchable generation.

    The age of having a dependable supply is over – time to buy a small generator to power the freezer, fridge & (gas) boiler.

  72. David Friedman says:
    February 16, 2014 at 8:42 am

    You write:

    “As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there”

    I think that’s wrong. The costs you are listing, as I understand them, include both fixed and variable costs. If you need an extra unit of power and get it by adding one unit each of dispatchable and non-dispatchable, you are only going to run the dispatchable when the non isn’t producing, so it will be consuming less fuel than it would take if it were doing all the production, so the cost you have to add for it is less than your seven cents.

    Thanks, David. You seem to think that if a generation mix contains say 30% wind, and the wind suddenly drops, someone runs out and turns on the dispatchable power, and the rest of the time the dispatchable power is not running.

    This is not the case at all. Instead, the dispatchable power has to be on all the time, to make up the difference between the semi-steady load, and the wildly varying windpower input. If you need a hundred megawatts, and the wind side varies in a very short time between say zero and two hundred megawatts, you need what are called “spinning reserves”, generators that are running already. (You also need to shed the generated power, but that’s a separate question.)

    And not only are the generators running, they are running under the worst conditions imaginable, which are that they are constantly varying their speed. That’s very bad for an engine of any kind. More to the point, it is very damaging to the efficiency of the system, it wastes energy to ramp it up and down and up and down.

    So yes, you do need to add in the $0.07 per kWh to the figures for the intermittent power sources. You will need to have the equivalent dispatchable power, you’ll need to have it running all the time, and you’ll need to have it running in the most uneconomical manner.

    w.

  73. Sergey says:
    February 16, 2014 at 8:56 am

    Willis, your classification of types of generators is not entirely correct. No generator which includes boiler tank is really dispatchable for a simple reason: it takes several hours to heat boiler for megawatt steam turbine to operational temperature from a cold shut.

    Thanks, Sergy. You are correct, and there are always subdivisions within divisions. In this case, the dispatchable power can be subdivided into baseline power, which are the boiler fired type you mention above, and peaking power, these days mostly gas turbines.

    w.

  74. Frank says:
    February 16, 2014 at 9:51 am

    Willis: Did you read far enough to discover that these figures arise from a massive economic model?

    Thanks, Frank. I didn’t have to read at all to know that the estimated costs of a new power plant that is started today, finished five years from now, and run for a quarter century will be the results of a model.

    Do you know any other way to estimate the costs and benefits of such a project? Of course both electric utilities and governments use economic models for this purpose—it’s not only our best option, it’s our only option, unless you include counting on our toes …

    Indeed, I put this information out there in part so that people can examine and discuss the various assumptions that go into the models.

    w.

  75. Wind power is fabulously uneconomic. A recent report (http://www.americanthinker.com/2010/02/wind_energys_ghosts_1.html ) documents that some 14,000 power-generating windmills have been abandoned in California alone. After the developers made their money, and the government subsidies and forced-purchase agreements were all used up, the construction all done, all wired into the grid, and getting “free” wind energy, they still couldn’t cover their own maintenance costs and were shut down.

  76. Or
    When what goes around comes around and the “Tea Party” gets control of the levers of power in D.C. and they use the NSA to get the membership records of Earth First and Greenpeace and the IRS gets to work on that list a bit.

  77. Willis

    Here is a report from the State of California Energy Commission.

    CEC-200-2007-011-SF

    COMPARATIVE COSTS OF CALIFORNIA
    CENTRAL STATION ELECTRICITY
    GENERATION TECHNOLOGIES

    The results are considerably different from the ones in the report that you reference Willis.

    Coal is the cheapest and nuclear second. Wind and Solar are the most expensive.

  78. @wayne Job, First post.
    “The cost of free energy seems to come in at around three times the price of unfree energy.”
    Not trying to be a pain . But I wonder, what is the cost of “free” energy? Is it not free?

  79. itsonlysteam says:
    February 16, 2014 at 9:13 am

    So let me tell you how it really works in a ‘deregulated’ generation market in North America.

    ======================================================

    The U.S. market is highly regulated. So what are you talking about?

  80. Willis Eschenbach said on February 16, 2014 at 10:01 am:

    “You also need to shed the generated power, but that’s a separate question.”

    Anecdotally, it is my understanding that there are special facilities that shed generated power directly to ground and are paid to do so. I suppose that it is not technically trivial to dump large amounts of electricity to ground safely.

    How much generated electricity is shed to ground, at what total cost and whether this is subtracted from renewables’ generation figures are open questions to me.

    Is this significant?

  81. The wholesale price of electricity in the US is about $.04/kwh. About half the cost of the lowest cost power plant. If these cost are accurate, no one would build any new power plants.

  82. fobdangerclose says:
    February 16, 2014 at 10:42 am
    Or
    When what goes around comes around and the “Tea Party” gets control of the levers of power in D.C. and they use the NSA to get the membership records of Earth First and Greenpeace and the IRS gets to work on that list a bit.

    …………………………………………………………………………………………………………………………………….
    classic error made by progressives. they think everyone is vindictive and mean. when the truth is usually it is only progressives who display such traits. if the Tea Party displayed as you suggest then they wouldn’t be Tea Party ..they would be progressives like you.

    I don’t think it is normally worth addressing a troll/progressive but you give an opportunity to show how deranged progs are. you are a teachable moment.

  83. OT
    You would think that the Pres. and his staff of “Climate Change” belivers would think a bit before Pres. Obama the next day after his big “tax and spend” on Climate Change speach,,,, he goes golfing at Palm Springs Calif..

    Not sure there is a more wasteful use of water resources on the planet.

  84. Gen.Malaise,

    Did not think I need to put a “sarc” tag on that post.
    Sorry to say but most who know me think I am a “knuckle dragging right wing Republican conservative” sorry to distract you.

  85. asybot:

    At February 16, 2014 at 10:50 am you ask

    But I wonder, what is the cost of “free” energy? Is it not free?

    I answer.
    All energy is free. It was all created at the Big Bang
    Collecting energy and concentrating it in a form to do useful work has costs.
    Nature has collected energy and concentrated it in fossil fuels and radioactive materials.

    The high energy density in fossil fuels and radioactive materials means that it is easy to get a lot of useful energy by obtaining and using them because nature has done most of the energy collection for us. It is much more expensive to do the collection for ourselves.

    For example,
    fossil fuels are solar energy collected by plants using photosynthesis over geological ages then provided in dried, compressed volumes of material
    but
    biomass is solar energy collected by plants using photosynthesis over a few years then provided in wet, uncompressed volumes of material.

    With the exception of the solar energy obtainable from hydropower, all the sources of ‘renewable’ energy are so diffuse that it costs much more to collect it than the cost of obtaining similar amounts of useful energy from using fossil fuels and e.g. uranium.

    Richard

  86. fobdangerclose says:
    February 16, 2014 at 11:05 am
    Gen.Malaise,

    Did not think I need to put a “sarc” tag on that post.
    Sorry to say but most who know me think I am a “knuckle dragging right wing Republican conservative” sorry to distract you.

    I don’t try to read minds and I DON’T know you. ….so if you want sarc don’t come off as a prog. I see nothing to indicate sarc in that post.

    cheerws

  87. The cost of necessary transmission lines should be included.

    As for turbine maintenance, where are average figures for the cost of gear box replacements? Portsmouth, RI, got an estimate of $580,000 to $730,000 to replace one in a $3 million turbine that failed after 5 years of use.

    “Most turbines require significant repairs and even complete overhauls in the 5-7 year range.”
    TRIBOLOGY & LUBRICATION TECHNOLOGY

    http://www.stle.org/assets/news/document/cover_story_06-10.pdf

    Regarding the diminishing returns from renewables, ever hear of the ‘duck curve’?

    http://www.sfgate.com/business/article/Energy-grid-duck-chart-used-to-wade-into-timing-4762718.php

  88. Regarding CCS (carbon capture and storage) at SaskPower, here is a good article about that “world first”. After a discussion of subsidies and regulations forcing this, the the final paragraphs conclude:

    But doubt continues to hover over the technology. As recently as last week, a U.S. Energy Department official told a government panel that capturing carbon from coal-burning power plants may raise the cost of electricity by as much as 80%.

    “We don’t see the 80%,” Mr. Watson said. “If you are able to sell the CO2, then the costs are marginal. If you are not able to sell the CO2, then, yes. We will prove it out over the next two years.”

  89. richardscourtney says:
    February 16, 2014 at 11:09 am
    ************
    Amen Richard and kudos to you for that post. I wish to God that the leftist greenie solar and wind pushers would take the time and be open-mined enough to understand that. I believe their failure or refusal to acknowledge it (among other things) is at the root of their problem. They are so intensely obsessed with the emotional and spiritual need to demonize fossil fuels and nuclear power that nothing else matters to them. It’s like trying to reason with a brick wall.

    I just hope and pray that our next president here in the U.S. has at least SOME understanding of what is wrong with the leftist green movement involving their belief system(s) and how they think. If he/she doesn’t, I cannot say that I will have a great deal of confidence in this nation’s long term future.

  90. Every now and again I check to see how efficient wind power is by checking the statistics such as those found here: http://www.ewea.org/fileadmin/files/library/publications/statistics/EWEA_Annual_Statistics_2013.pdf
    The recurring theme in these annual reports is the hyping of the new additional capacity and the hiding of the efficiency number. The numbers in this latest industry report suggest that the utilization figure for all the European Union (EU-28) is 25%. But this is a huge fudge as is readily shown by the figures for Germany which in 2012 came in at 18% – Germany has 25% of the installed wind power capacity in the EU-28. (These numbers are from Government sources.)
    According to the global figures for 2011 from industry sources, then number is 21.3%.
    I would be interested if anybody has a reliable source of data on actual power generation from wind.

  91. What is ignored in the cost analysis is that the wholesale price of electricity is variable. If you have coal/gas/nuclear plants on-line handling the load, then suddenly add a bunch of wind farms as the wind starts to blow, the wholesale price will drop to $0. It may even go negative, because no one wants the excess power.

    However, when wind farms are given guaranteed wholesale prices, they keep on pumping out as much power as possible, even when the market price is negative. We end up subsidizing someone that is disrupting the grid, by supplying power at exactly the wrong time.

  92. The first state in USA which deregulated electricity production was California, which introduced energy market in the industry. This led to disaster, since economical model was poorly thought out. When energy was in short supply, operators of the grid had to purchase energy at exorbital prices to balance load and generation output. I translated a monography about this experiment for Russian state energy monopoly which was formed to make market reform of Russian energy industry. The title was “Designing of energy market” and the prices were from this experiment. I believe them more than the prices above since they were based on real experience of the market, not on abstract calculation. Nuclear and coal plants have comparable costs of fuel for kilowatt-hour and comparable capital costs of construction. Fuel costs were 5 time less than for natural gas turbines, but capital costs 5 times higher. Now, with collapse of natural gas prices, this calculation can be different, but coal is still the cheapest way to generate electricity. And there is no alternative to 1000 MhW steam turbine!

  93. daveburton says:
    February 16, 2014 at 6:40 am
    Problem #1: The U.S. Dept. of Energy put its big fat federal thumb on the scale.
    ============
    that explains how the government come up with nonsense estimates that the cost of new power plants to be twice the wholesale price of electricity. what you are reading is a politically correct version of the real world.

  94. jai mitchell says:
    February 16, 2014 at 8:21 am
    The EIA LCOE analysis is flawed.

    NREL Estimates of LCOE for installed domestic wind in 2012/2013 BEFORE SUBSIDIES come in at 0.0675, the trend is that LCOE will continue to go down from there.

    Offshore wind currently comes in at 0.185 (convert euros to dollars)

    If these wonderful machines are such a bargain how is it that governments everywhere must hand out $billions in loans and grants to their cronies along with contracts with prices from $0.20 to $0.40 /kWhr from now to when the damn things collapse, in order to get anyone to even consider building one?

  95. How the heck does all that power traverse through those little wires in the air without them just exploding? Alas, this chemist is still confused. I mean even if they are superconducting, what is the intuitive explanation of how each inch of the wire can contain enough juice to power a good portion of an entire steel plant or a small town, enough energy to represent a bomb going off on the spot. I’ll ask Lubos Motl one day.

  96. Ed P says: @ February 16, 2014 at 9:56 am

    “There are two options”
    The other option will soon be here: smart meters are being installed all across the USA (& soon in the UK). These will allow the grid controllers to switch homes partially or fully off when the renewables cannot cope and there is insufficient dispatchable generation….
    >>>>>>>>>>>>>>>>>
    You beat me to it.
    Some links to go with your comment:

    The Department of Energy Report 2009

    A smart grid is needed at the distribution level to manage voltage levels, reactive power, potential reverse power flows, and power conditioning, all critical to running grid-connected DG systems, particularly with high penetrations of solar and wind power and PHEVs…. Designing and retrofitting household appliances, such as washers, dryers, and water heaters with technology to communicate and respond to market signals and user preferences via home automation technology will be a significant challenge. Substantial investment will be required….

    These controls and tools could reduce the occurrence of outages and power disturbances attributed to grid overload. They could also reduce planned rolling brownouts and blackouts like those implemented during the energy crisis in California in 2000.

    Investors see the Smart Grid and Smart appliances as a good investment oppurtunity.

    Smart Meters, an attractive opportunity for Investors

    This is Frédéric Bastiat’s Broken Window. Take perfectly good equipment and trash it so someone can sell you new. Expect to see the government (or electric companies) mandate smart Meters and the purchase of new appliances that can be switched off by the power companies.

    Don’t want smart meter? Power shut off
    The rollout of smart electric meters across the country has run into a few snags: one woman doesn’t want one, and ended up in the dark as a result.

    You might not think that would be an issue. But it is, because Duke Energy is now beginning to disconnect any homeowner who refuses a new electric meter.

    Energy InSight FAQs

    ….Rolling outages are systematic, temporary interruptions of electrical service.
    They are the last step in a progressive series of emergency procedures that ERCOT follows when it detects that there is a shortage of power generation within the Texas electric grid…. With smart meters, CenterPoint Energy is proposing to add a process prior to shutting down whole circuits to conduct a mass turn off of individual meters with 200 amps or less (i.e. residential and small commercial consumers) for 15 or 30 minutes, rotating consumers impacted during that outage as well as possible future outages.

    There are several benefits to consumers of this proposed process. By isolating non-critical service accounts (“critical” accounts include hospitals, police stations, water treatment facilities etc.) and spreading “load shed” to a wider distribution, critical accounts that happen to share the same circuit with non-critical accounts will be less affected in the event of an emergency. Curtailment of other important public safety devices and services such as traffic signals, police and fire stations, and water pumps and sewer lifts may also be avoided.

  97. For years I’ve been hearing about next-gen nuclear and Modular Nuclear, but has anyone actually built an operational model? I’m amazed when I hear about Toshiba and GE working on these, as there doesn’t actually seem to be a market.

  98. Not to nitpick Willis, but generator speed doesn’t vary much when it is synchronized to the grid. Frequency of the grid is regulated tightly. Output is regulated by steam input into the turbine.

  99. These “levelized” prices are nonsence. Peak load prices always are at least 3 times more than base load prices, and can be 10 times more if the peak load cannot be predicted 24 hour before the event. To instantly put generator under load, it must be kept rotated synchronously with the grid frequency, and this imposes additional costs. At least 10% of expected power increase must be kept in the form of rotating, but unloaded generators ready to be put under load. To keep them rotating, some gas must be burned without any electricity produced.

  100. urederra says: @ February 16, 2014 at 6:46 am

    …. Nuclear looks expensive. I thought It was cheaper.
    >>>>>>>>>>>>>>>>>>>>>
    It was cheaper until you add in new regulations, regulatory delays and protesters….

  101. Silly me. I was taught to buy cheap and sell high in any sales course I ever took. I ran my business that way for nearly 40 years. According to this idiotic graphic, SCANA/SCE&Gouge is selling power to me at my house for LESS than this thing says they can make it. How do they do that? They don’t.

    http://www.powerisknowledge.com/

    The grid is selling wholesale power to the little power companies for $36/MWh, 3.6 cents per KWh, today. It varies with demand, of course. One great thing about power, like internet data, you can’t put it in a tank farm and starve the consumers until the price skyrockets, so they sell it for what they can get, today….$36/MWh. That’s the WHOLESALE price of producer’s cost PLUS PROFIT, the investors keeps screaming about. So, the chart is WAY HIGH! I’d guess $36/MWh is double what it costs to produce it, about $18/MWh, which makes more sense. SCE&Gouge is a producer with gas, coal and nuclear plants across SC. Make it for 1.8 cents per KWh and gouge me for 14.656c/KWh, thanks to the SC govt utility regulators, who work for the power companies. Here’s what South Carolinians pay their little electric companies:

    http://www.orbgdpu.com/ratecomparison.htm

    Orangeburg, SC, wasn’t big enough for SCE&Gouge to worry about back in the 20′s, so the town made its own electric/gas/water/sewer company, owned by the people, who pay 10.5c/KWh on this page from the SAME SCE&Gouge power plants as I do. They buy from SCE&G wholesale at the grid rate of $36/MWh from the first webpage and charge triple for their costs and profits.

    I don’t see how anyone reading electric rates across America can believe “Levelized cost is the average cost of power from a new generating plant” is correct. We’d be paying 40c/KWh!

    Electric car loads will drive power costs through the roof if they ever make them viable…..

  102. By the way, a recent poll shows that 1 in 4 Americans actually believe the SUN rotates around the EARTH so don’t think anything about energy has to make any kind of sense for the next 2000 years….(sigh)

  103. Willis, your cost figures can’t possibly include the costs of backup generation for “renewables,” nor the cost of land for footprints hundreds of times that of fossil generation, nor the greater costs (about 5.5x, on a per-MW basis) for the generation equipment itself, nor the costs of otherwise unneeded substations and transmission lines from the remote locations of “renewable” generation. They plainly don’t consider the need to have spinning reserve running virtually all the time, i.e., burning fuel without injecting power into the grid, and the inevitable substantial use of quick-start generation with heat rates two to four times higher than baseload fossil generation – which means that more fossil fuel is burned to accommodate “renewables” than would be burned if there were no “renewables.” They plainly don’t consider the amount of unused capacity on the transmission lines to “renewables,” which have to be able to handle the full output of the “renewable” generation yet are effectively idle 3/4 of the time for both wind and solar – effectively multiplying the per-MWh cost of transmission for “renewables” by a factor of at least 3 over fossil generation. They don’t consider the unreliability of equipment – all you have to do to see this is drive over the Altamont Pass or Tehachapi Pass here in California, a few times, to see how many of the turbines ain’t turning. Also, the presence of “renewable” generation creates nightmares for managing congestion on major transmission lines and often requires the substitution of more expensive purchased power for cheaper locally generated power. In fact, “renewables” are one of the main reasons for establishing independent system operators (ISOs) and regional transmission organizations (RTOs), to deal with much more complex congestion management problems, which adds a further layer of bureaucratic expense to electricity costs in the form of grid management charges and “congestion revenue rights” (a form of prepaid transmission cost that adds substantially to a utility’s cost of transmission, and which represents a tradeable add-on to prices similar to carbon credits, and like them, creates no economic value).

    In short, there are a lot of variables and inefficiencies associated with “renewables” that never seem to be taken into account, and in fact they are deliberately ignored by the people touting them in order to convince uninformed people to go along with what is actually a scheme for transferring wealth from low- and middle-income ratepayers and taxpayers to billionaire investors in projects that are both uneconomic and environmentally ruinous. Why should ordinary folk pay double and triple prices for electricity and extra taxes so that billionaires can get richer? Why should US manufacturing be made less competitive with needlessly higher electricity costs? That’s the real issue here, along with the environmental destruction and slaughter of wildlife caused by “renewable” energy.

  104. Just wait what happens to electricity prices when you’re forced to drive electric because you’re entire city is turned into a freaking green zone.
    In the mean time we have a nitwit like Elon Musk telling us that emitting carbon emissions is just as bad as smoking and that’s why we have to drive electric.

    According to Musk Global Warming IS Real.

    Now that must be the reason why his freaking Tesla’s continue to suffer from spontaneous combustion:

    http://www.businessinsider.com/february-1st-toronto-tesla-fire-2014-2#

    Now that’s what I call a self-fulfilling prophecy.

    Just like the Somerset Floods.

  105. All I know is that in Australia electricity prices keep going up. The Australian Bureau of Statistics shows that from Jun 2007 to Dec 2013 the consumer price index rose by 19%, but electricity rose by 111%.

    A March 2012 paper, Australian Electricity Prices: an International Comparison, commissioned by the EUAA shows that Australia’s electricity prices are very near to the highest in the developed world and seemingly set to reach the highest.

    “Rising electricity prices are having a major impact on the cost of living and of doing business. All Australians know this and are naturally concerned about it,” Mr. Roman Domanski, Executive Director of the EUAA said.

    “This paper exposes the myth that Australia continues to have low, or even mid range, electricity prices. Electricity is becoming a lot less affordable for both households and businesses and our prices are now a source of national weakness rather than strength.”

    AEMO publishes annual prices paid to generators but they seem to jump all over the place, and are clearly not connected to the prices I pay.
    For Victoria, $27.62/MWh in 2004/5 to $54.27/MWh in 2013/14 (or 5.4 cents/KWh).

    The Origin Energy website states that the average household consumes about 6.5MWh of electricity per year, and that costs $1500-2500 per year depending on location so that equates to $231-385/MWh or 23-38 cents/KWh. They also show a chart that indicates about 10% of that is GST tax, Government green schemes about 15%, about 10% goes to Retailers, generators get about 20% and networks 45%. (I suspect that network portion is increasing in order to cope with “non-dispatchable” power from solar and wind.)

    Why won’t our governments tell us what the typical costs in Australia are for each power source in cents/KWH, given each gets an appropriate return on investment?
    And then tell us in simple terms what goes into the average price of our electricity in cents/KWh.

    ENOUGH!! Get rid of the CO2 tax, and then the Renewable Energy Target (Tax).

  106. Hhans1 says:
    February 16, 2014 at 12:36 pm
    “Not to nitpick Willis, but generator speed doesn’t vary much when it is synchronized to the grid. Frequency of the grid is regulated tightly. Output is regulated by steam input into the turbine.”

    It is true that the grid is a tightly regulated, synchronous system and most base-load generators are synchronous machines that do not vary speed at all between no-load and full-load. However, many wind generators are “induction” machines that do vary in speed. Their output depends on “slip speed”, which is a measure of how much faster they are turning than the synchronous system against which they are “beating”.

    Wind machines are a nightmare for system frequency and power factor regulators.

  107. @Gail Combs -

    Yes, CCS could cause a disaster that would make Chernobyl look like child’s play.

    Incidentally, during the attempt to build a CCS plant in Queensland, Australia, they were unable to stop the CO2 from escaping as fast as it was being pumped into the ground.

    And think what could happen if you had a highly pressurized CO2 reservoir under a major generating plant in, say, Los Angeles, and an earthquake compromised the reservoir? Another Lake Nyos – and worse.

  108. @R. de Haan -

    Yes, and where does Musk think the electricity to power his contraptions comes from? Not wind or solar, you can bet on that. Manufacturing and charging his jalopies burns more carbon than any gasoline- or diesel-powered car.

  109. I don’t believe the cost of the CCS technology. I do NOT find a less than 20% increase in cost anyway credible. I think people who are promoting CCS and wind put this chart together.
    BTW… my last electric bill I am paying $0.284 per kwh, and it supposed to go up another 30% over the next couple of years to cover additional GREEN energy going in to the mix.

  110. @ Claude Harvey -

    Thanks for adding the power factor management and synchronization problems to the list of problems I cited in my post – these also are serious issues. The variability of wind does indeed make it extremely difficult to synchronize and to maintain a steady power factor, and when these are not maintained it can do enormous damage to equipment running on the current. Yet more difficulties and inefficiencies, raising hell with the entire process of dispatching generation from all sources to load. Wind power is probably substantially shortening the operating lives and impairing the reliability of anything exposed to it. Yet another cost not factored in

    The obstinate ignorance and economic illiteracy of “renewables” proponents never ceases to amaze.

  111. Wind power to electrical equipment is as ethanol to internal combustion engines – increases wear, shortens operating life, emits more pollution.

  112. They forgot Capacity! There is not the capacity in wind farms to power New York, let alone the US, China, India, Europe and others!

  113. As I vaguely remember it, running turbines up and down is not trivial and takes time. Having the dispatchable turbines doing it all the time will not work at all.

  114. Too many picky comments, imo.

    Willis has it essentially correct – of course the numbers are approximate.

    For the mainstream media, we have to dumb it ‘way down:

    Grid-connected Wind Power: It doesn’t just blow – it Sucks!

    Grid-connected Solar Power: Stick it where the Sun don’t Shine!

  115. My compliments Willis and to the many commenters who obviously work within the utility industry as do I. Let me offer further points and clarifications…

    CCS capture at the SASK plant is costing about 25-30% of the plant capacity (the lead engineer told me). Because it is sitting on top of an enhanced oil recovery sink (EOR), Co2 injection cost is nil. Most of the existing coal fleet in the US is not so positioned, and will need to transport and inject into suitable geology. The enviros know this and are waiting to pounce. Thus, the true CCS cost is as unreliable as a climate scientists model.

    Correction to en earlier post: A 600 megawatt supercritical coal unit can achieve full loading from cold startup in about 24 hours. It can throttle at about + or – 2mw per minute with a minimal load threshold of about 300 mw.

    This winter, both PJM and TVA peaked due to colder than expected weather. They both came within a one unit trip of calling for rolling blackouts. Folks, this is scary stuff. Now for the kicker…in 2015 35-50 gigawatts of coal fired capacity is slated to come out of service due to the MATS rule.

    Easy you say…we will just build gas plants. Ok, let’s go there for a minute. Gas is a home heating and industrial fuel…There isn’t enough pipeline capacity to handle even the gas plants we have today! (We had half our gas plants off in January due to lack of available gas).

    Look at all that Marcellus gas in Pa., you say? Just 250 miles away from The New York area! You think you are going to build high pressure gas lines to the Hudson, cross over to the east side and up through Connecticut? Ha! The enviros will see you in court and the EPA will willingly settle with them.

    Folks, brace yourself…as any utility engineer will tell you, this is going to be ugly.

    But, hey…Bill Nye was on CNN today and said the debate is over and the consensus is real so get over it. He evidently knows a lot….

  116. EIA. stats have been politically manipulated like this for many years. An old government trick to falsely frame the debate. When you point out the trick you are called a conspiracy nut. Sound familiar.

    In the US Congressional hearings may smoke out the malfeasance but that requires political will. Since many on both sides of the aisle benefit from green power schemes that is often lacking.

    Thank you to those with the skill to educate posting here.

  117. Willis wrote: Thanks, Frank. I didn’t have to read at all to know that the estimated costs of a new power plant that is started today, finished five years from now, and run for a quarter century will be the results of a model. Do you know any other way to estimate the costs and benefits of such a project?

    Excellent point, Willis. One can get a pretty good idea of how much electricity generation projects currently cost to build, because there is a reasonably free market for constructing and funding such projects. It doesn’t take a sophisticated model to extrapolate from the costs of projects currently underway to a project that will be started soon. So capital costs are reasonably well known. However, fuel cost is much higher than capital cost for fossil fuel plants. The current cost of fossil fuels is known and extrapolation for fuel costs over the next decade is probably reasonable. (The boom in natural gas will hold down the costs of carbon-based fuels in the near future.) So, I would base that my cost estimates off of those prices, not the predictions of a complicated model trying to predict how the cost of different fuel sources will change over the next thirty years.

    An investor contemplating building an electrical generation plant would ask how well the EIA’s model would have hindcast changes in fuel costs over the past half-century. Given the volatility we have seen over this period, it is unlikely that the EIA’s model would show much skill. Furthermore, no model can predict what government policies (carbon-tax? cap-and-trade?) are going to do to the marketplace. An investor would probably want to lock in a long-term supply contract with a large company supplying the fuel, reducing risk to both the electricity generator and the fuel provider. (The investor might also want a deal with the local public utility commission that allows him to pass on some of the fuel-price risk onto customers.) Finally, the investor will have arranged to recoup his capital investment over the first decade of operation, so that only his profit depends on fuel cost and electricity price in the distant future. So I would guess that the price of current short- and long-term fossil fuel contracts today would give us a far better idea of what electricity from fossil fuel plants will cost than the EIA’s model (with all of its assumptions and possibly hidden biases). A survey of the expert judgment of those actually in the business of running fossil fuel plants would also be extremely valuable.

    In any case, the EIA should be reporting a range of possible costs (not a single value) and a list of the key assumptions that have the most impact on the range. Within that range, they could highlight prices that illustrate prices that show: a) the consensus of experts, b) straightforward extrapolation from current prices, and c) the output of their (non-transparent) model.

  118. Willis, when it comes to estimating the cost of a coal fired electricity plant, the most accurate estimate in my opinion would be to look at the actual cost of producing electricity from a coal plant in 1995. Add 20% to cover the cost of inflation and be done with it. Anything over that is cost due to increased regulations, ridiculously long environmental delays and GREEN fantasies, which can and should be removed.

  119. A minor point about your methodology:
    “As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there, so you’ll have dispatchable power when you need it.”
    You’re adding the full cost of the equal amount of dispatchable, but it’s less than that. For example, if you add “advanced combined cycle gas” as your dispatchable back up, it would only be required when demand was high and at the same time the non-dispatchable wasn’t working. If for example, that was 1/10th time, then the back-up cost would be the capital cost of the gas plant + the low maintenance cost given it’s only used 1/10th the time + the gas to keep it ticking over + the gas for the 1/10th the time it’s actually used. That might be 4 or 5 cents not 7.

    On the other hand, there is another cost of using non-dispatchable power sources : the expensive switch gear required for very short term fluctuations. Despatchable power supplies have large rotating masses that store kinetic energy. Solar power can go from max to none in a few seconds as clouds move over.

    I think the EIA figures for solar and wind are crap. Wind towers cost hundreds of thousands of dollars and last 15 or 20 years. They produce maybe 20% of their rated capacity, down to 15% as they age. When there’s no wind they produce no power, when it’s too windy they have to be tethered to prevent damage. I think the EIA is under-estimating the cost of wind power by taking the rated capacity and multiplying by an overly optimistic percentage for actual average production. The rated capacity assumes perfect wind speed, not too fast and not too slow. The wind is hardly ever just right. The solar and wind costs in the table just don’t look right. One trick I’ve seen in newspapers is to include subsidies in the cost equation. If the government gives say 20 cents a unit in subsidies and tax breaks, the newspaper article would take that off the cost of producing the power. Greenies can then say the solar and wind power is competitive with fossil fuel. Of course anything is viable if the government subsidies it enough. The true cost has to include the cost of those subsidies, as they just change who is paying not what it costs.

    Could you check:
    . What % is the EIA using for average production over rated capacity.
    . Is the EIA cost for solar and wind the total cost of producing that power, or is it the cost to the generator after allowing for subsidies.

  120. A couple of interesting numbers …

    According to the Pickens Plan, “The clean generation provided by wind capacity installed through 2008 will displace approximately 44 million tons of carbon dioxide annually.”

    http://www.pickensplan.com/wind/

    According to the US EPA, total US Carbon Dioxide Emissions in 2008 were about six thousand million metric tons.

    http://www.epa.gov/climatechange/ghgemissions/gases/co2.html

    A very expensive small drop in a big bucket.

  121. Sergey says:
    February 16, 2014 at 11:59 am

    The first state in USA which deregulated electricity production was California, which introduced energy market in the industry.

    ====================================================================

    BS. California re-regulated electricity production. The pols called it deregulation. Their stupid new regulation caused the problems. Then the pols declared from the mountaintops, “SEE, DEREGULATION DOESN’T WORK!”

  122. Oatley says:
    February 16, 2014 at 2:34 pm
    “My compliments Willis and to the many commenters who obviously work within the utility industry as do I. Let me offer further points and clarifications…
    CCS capture at the SASK plant is costing about 25-30% of the plant capacity (the lead engineer told me). Because it is sitting on top of an enhanced oil recovery sink (EOR), Co2 injection cost is nil.”

    Drive up cost of electricity while stealing plant food from the ecosystem? Must be a Holdren idea. Nobody else in the Obama administration could be as destructive.

  123. I always like to check the figures. I have done a quick comparison with UK figures on my blog

    http://manicbeancounter.com/2014/02/17/understanding-the-us-eias-levilized-cost-of-electric-generation-figures/

    In summary:-
    1. EIA assumes capacity utilisation for onshore wind is 34%. In the UK in 2012 it was 26%. Adjusting for this would increase the cost of electricity from onshore wind per kwh from $0.087 to $0.117.
    2. Cost of electricity from biomass seems low. If they are true, the UK could adopt this best practice, and save UK energy consumers $500m per annum on subsidies.
    3. Transmission costs are vastly understated. Wind turbines tend to be located a great distance from consumers. The EIA probably only includes the transmission costs for the electricity generator, and not the much greater additional national grid costs.

    In summary, the real costs of renewables to the consumer would appear to be understated.

  124. Hi, does anyone have a nice used 1961 Lotus Elite. I don’t want one in original condition – there is no such thing.

    This car is quite a classic: a pretty, ultralight, closed two seater sports car, produced from 1958 to ’63; I think Colin Chapman’s first of this genre. Oh, and it’s got a fiberglass body. A real fiberglass body. No, steel frame for this baby. Did I say I didn’t want one in original condition? Well, now you know why. I have no desire to have the suspension attachment points ripped right outta the body when I hit that inevitable pebble on the road that’s just a wee too big.

    Now, I know what you’re all thinking: whatever does a Lotus Elite have to do with a renewable energy source? And my answer is that it has absolutely, positively nothing to do with it.

    You see, when ominous storm clouds are developing, and golf ball size hail starts rat-a-tat-tating down you can rest assured that that Lotus Elite was whisked into a garage ahead of time. So, in this it bears no similarity to a wind turbine which, assuredly, won’t be whisked into a garage. That Lotus will also happen to be in the garage if there’s freezing rain – the wind turbine won’t. Since it doesn’t have AC and, what the heck, it’d probably boil over anyway, that Lotus is likely to be reclining in the shade in that same garage. Not so with the wind turbine. Oh, and if it’s 20 below outside you can rest assured that Lotus is going to be in that garage as well since there isn’t a chance in hell it’s gonna start. Might as well get long underwear, looong underwear, for that wind turbine ’cause, again, it ain’t goin’ in a garage.

    See, there’s no similarity between a Lotus and a wind turbine. Oh, there is one though; that wind turbine’s got fiberglass blades.

  125. Willis,

    Maybe a few more factors – this is from a comment at

    http://www.redpowermagazine.com/forums/index.php?showtopic=84772

    “IHRunner
    Posted 30 January 2014 – 01:29 PM

    interesting addition to this. the enviromentalist nuts who praise the windmills. who are now exempt from killing bald eagles.

    we had a truck come in and make a rush delivery for us. rest of his truck was mobil 1 55 gallon drums of oil. i ask. “whats that for” driver says “them springfield windmills”

    he makes a delievery every other week. the motors medium is oil. and because of the massive weight its needs to be replaced often. i had no idea they used that much oil.

    so windmills use oil and kill bald eagles. W**. and now they gripe about the amtrak. holy peets. morons “

  126. richardscourtney says: @ February 16, 2014 at 11:09 am
    …. All energy is free…..
    >>>>>>>>>>>>>
    That has to be one of your best posts a real classic.

    Now if we could only get that through a bunch of thick heads.

  127. I have worked in electrical generation all of my life. These estimates are just as useful as any other long term economic model. That is, they are based on a set of assumptions that can change the results and relative positions of each source. Some of the more important ones are capital asset lifetime, cost of capital and capacity factor. They are important because they impact the levelized capital cost.

    There are some important implications to these facts. For instance, you would never build a nuke with the intention of load following. A nukes cost is dominated by capital cost, therefore it needs to operate near full capacity. Idle capital is economically inefficient. It also means that people with an agenda can, and do, make ridiculous assumptions to further political agendas. In one study I read they had assumed a nuclear cost of capital of about 15%. No one would build anything if the cost of capital is 15%.

    Finally:

    Load and generation must be matched on a real time basis on the grid. Renewables create a significant complication with keeping load and generation matched……because now the grid operator does not have real time control of all the generation. As others have said, and there are studies that show the same thing, at about 15% renewables it starts to get tough.

    Another problem with renewables, as currently implemented, is that they do not pay the cost of the grid that they are still using and they are being paid all in retail rates to produce wholesale power. Nobody notices when only a few people are doing this via net metering, but when a significant portion of the ratepayers are net metering and are not covering the fixed costs of their grid connection then it becomes a problem.

  128. Oatley says: February 16, 2014 at 2:34 pm
    I am retired Utility, 10 years on the PJM. and Oatley is speaking the truth. I remember a winter in NJ when the gas pressure got so low that pilot lights went out. They were turning coal into gas to keep up the pressure and that was not enough. Many large heavy industry – Guarantee gas prices are going to go up and then Nuclear will be much cheaper. gas users had to shutdown. What will they do when they quit mining coal? Remember overhearing many conservations in the lunchroom between dispatchers about $2,000, $4,000 & higher per kWh electricity they had to buy.

    A “smart grid” only helps if you can move electricity around. to do that you need MANY more EHV transmission lines (like the ones you see along I-80 west of Chicago). The envirowhacos would sooner let you cut off their arm than let you build any and it will be 20 – 30 years before they have half enough to do any good. $20 Billion plus for one from the Texas panhandle to DFW area for WIND, thus it is only good one way and then only 25% of the time. $20 Billion would have built at least 4 Nuclear power plants near an existing line. The logic escapes me.

    The most efficient CCTG units use a steam turbine to get that efficiency and are the WORSE choice for backing up wind or solar. Coal and Nuclear work, but slowly. The older standard GT peaking units are the best, HOWEVER, the efficiency is so bad that you actually get lower CO2 emissions if you just forgot about the Wind/Solar and used a CCTG. The studies are on the internet. Google them. All studies that claim otherwise are bogus, envirowhaco propaganda. The efficiency of most coal, gas and even nuclear power plants drops to about 50% of rated efficiency at about 15% output. At 50% output it is About 1/3 as efficient as it would have been at 100% power, and below that you start loosing money. It takes about 10% of plant power just to run the larger plants and all of the other services (admin, shops, etc.) Even wind/solar are sucking power 24/7/365. Wind turbines have as many pumps, motors, control panels, lights, as a typical tug boat, or the average machine shop. There is analysis showing that Wind Turbines in the north sea of Ireland have actually used more electricity that they have produced – and these are the so-called cream of the crop off-shore Wind turbines. Seems like the designers didn’t think about how much power the heaters needed for the lube-oil and hydraulic systems needed to keep it warm enough to move.

    So again, If this is really all about reducing CO2 then Nuclear is the ONLY answer. Maybe in 50 years they might come up with a new solar idea, but I would not count on it. If they do not start building NPP’s then you know it is a SCAM.

  129. Chad Wozniak says: @ February 16, 2014 at 1:58 pm

    @Gail Combs -
    Yes, CCS…..
    >>>>>>>>>>>>>>>>>>>>>>>>
    Since our District of Criminals is forcing this idiocy on us I thing the first plant should be built in the area between 17th Street NM and 15th Street NW on Constitution Ave. Plenty of places in the vicinity to store CO2 near that area too.

  130. Something never mentioned with Wind power: According to an engineer I talked to, on the Columbia River the extremely expensive dam hydro turbines are wearing out much faster these days due to having to be adjusted so much because of the uneven power load forced on the BPA by the many wind farms in the area. Replacement parts are not only expensive, but impossible to have made in the US. These uneven loads are also very hard on transformers at substations.

  131. Doug Badgero says February 16, 2014 at 5:14 pm

    Load and generation must be matched on a real time basis on the grid. Renewables create a significant complication with keeping load and generation matched……because now the grid operator does not have real time control of all the generation. As others have said, and there are studies that show the same thing, at about 15% renewables it starts to get tough.

    It’s interesting to watch, here in Texas on our own grid (separate from the rest of the country exc for a few DC TIE lines which allow us to stay asynchronous with the rest of the country) the subtle change in AC line frequency using a dual-trace scope compared against a high-stability source of ‘AC’ sinusoids (e.g. an HP8904A Multifunction Synthesizer) … the ‘grid’ can be seen to ‘ebb and flow’ over the course of a few minutes as ERCOT works to keep the system balanced and ‘on frequency’. Things don’t improve with highly-variable ‘wind’ to the mix …

    .

  132. Oatley says: @ February 16, 2014 at 2:34 pm

    ….Now for the kicker…in 2015 35-50 gigawatts of coal fired capacity is slated to come out of service due to the MATS rule….
    >>>>>>>>>>>>>>>>>
    Thanks for that confirmation of what I had already suspected.

    The Institute for Energy Research says that the North American Electric Reliability Corporation evaluated four major regulations now being proposed or implemented by the EPA and“estimates that nearly a quarter of our coal-fired capacity could be off-line by 2018 and that as many as 677 coal-fired units (258 gigawatts) would need to be temporarily shut down to install EPA-mandated equipment.[ii] These EPA regulations must be implemented within a 3-year window and the mandated equipment takes about 18 months to install. Because EPA’s three year timeline is so tight and the regulations affect so many units, utility companies are not sure that they can meet the standards and ensure reliability of the electricity system at the same time.”
    (wwwDOT)instituteforenergyresearch.org/2012/08/01/generating-companies-are-shuttering-coal-plants-at-record-rates-eia-reports/

    It looks like a massive problem just-in-time for the next president and that is a gross understatement especially when 1/3 of the nuclear plants may also be shutting down. About 10% of capacity will be shutdown permanently and 1/2 of the remaining coal plants shutdown for an 18 month retrofit. Coal now supplies ~ 40% of our electric. It looks like the light at the end of the tunnel is an on coming train.

    Get your diesel generators and supply tanks now before the rush folks.

    Oh and do not forget the EPA has also targeted Wood Stoves. Looks like Holdern and Co. really do want us to die.

  133. Two points. Localized power generation (i.e. natural gas) saves transmission costs and those can be very expensive, depending on where you live. Second, to increase WT efficiency why hasn’t someone desi9gned a horizontal system so all the major moving parts can be at ground level?

  134. Lightrain says February 16, 2014 at 5:57 pm

    Two points. Localized power generation (i.e. natural gas) saves transmission costs …

    Hmmm … shifts that ‘transmission; job over to the ‘pipeline’ network, which may require ‘upgrading’ if sufficient demand for natural gas materializes …

    .

  135. We simply must to find a way to store up wind power for those moments when we really need it. I’d suggest bottling up Nick Stokes, & then showing him an Eschenbach post, & tell him the spinny thing is a speech-to-text converter when the grid needs a little boost.

  136. A most excellent discussion. I have also spent my entire career in the electric utility industry trying to explain the folly of grid-connected intermittent resources and the games people play with levelized cost forecasts. I am heartened to see how many of my fellow engineers are skeptical of the whole climate change scam.

    Can anyone point me to studies that address the net impact of wind-turbines on CO2 emissions when the need to provide fast ramping generation reserves is taken into account? My intuition is that we are better off even from a CO2 perspective building a CCGT, than building windturbines with “back-up” ( as it it euphamistically phrased by greens) from gas turbines which presumably would have to be simple cycle. We knw the economics but can anyone point to the CO2 numbers on this?

    Richard

  137. Lightrain says: @ February 16, 2014 at 5:57 pm
    ………… Second, to increase WT efficiency why hasn’t someone desi9gned a horizontal system so all the major moving parts can be at ground level?
    >>>>>>>>>>>>>>>>>
    I assume WT is wind turbine.

    You run small home windmills at least 80ft off the ground because that is where the wind is. Think trees.

  138. len says:
    February 16, 2014 at 5:40 am
    Thanks Willis …
    At what point do we all start installing gas reciprocating engines like some industrial customers (http://www.catpowerplants.com/Default). Maybe that’s not what the regulators wanted, shopping malls with on site thermal generation because of the degraded infrastructure and ‘all in’ cost of this ‘fuel mix’.
    ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++\
    Len – Albertan to Albertan – I live in rural Alberta. In the 50′s and early 60″s we had a “light plant” on the farm which consisted of a building full of batteries and an old “one lung” diesel generator. We ran the milk separator (big advantage over the old hand crank one) and a few other things twice a day then shut it down and used kerosene or naphtha lighting. If prices increase much more, I may be looking at a battery building again (I already have an LP generator). I still have a wood stove with a water reservoir and hot water heating coils. But what will city folks do as the John Kerry’s of the world go around making statements like he made today in Indonesia about Global Warming being the greatest threat to the world today? It justifies the ridiculous expenditures and increases in energy costs in the US, Canada, and other countries while scaring sh– out of the public. Meanwhile, Eastern North America is shovelling up all that Global Warming and England is pumping it.

    Where are the leaders?
    ================================================================
    PV’s – maybe in the near future, but I look at it every few years and until electricity costs triple or battery technology improves greatly, it doesn’t compete at this latitude and may never be practical in the winter with just a few hours of sun.

  139. Lightrain says:
    February 16, 2014 at 5:57 pm
    Second, to increase WT efficiency why hasn’t someone desi9gned a horizontal system so all the major moving parts can be at ground level?
    +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    Environment Canada had a very large experimental vertical axis (VA) wind turbine just north of Lumsden, Saskatchewan for years. There are now many VA designs.

    http://en.wikipedia.org/wiki/Vertical_axis_wind_turbine

  140. usurbrain says February 16, 2014 at 5:21 pm

    A “smart grid” …

    The so-called “grid” (from generation to transmission and into the switching yards) is already ‘smart’; it’s the last leg of ‘distribution’ onward toward ‘the home’ (and business) which is being made ‘smart’*.

    .
    * their term, not mine.

    .

  141. Non scientific envro greens don’t understand why you can;t just add intermittent generation to the grid.

    It’s because you have to keep the grid stable and not oscillating.

    Perhaps you have seen pictures of the Verazano bridge in Washington back in the 1930-40s. A little wind started the bridge oscillating and each breathe of wind added to it until the bridge was wildly swaying, Finally a bridge support snapped adding stresses to other supports, which soon failed also, and the bridge came crashing down,

    That is exactly what happens on a grid, with power sloshing back and forth until a circuit breaker trips or a transformer blows on a grid transmission wire over loading the others, until there is a cascade of failures, and blackout.

    There is no fixed amount of intermittent power a specific grid can handle as each is different.

    Power EEs spend lots of time calculating the stability of a specific collection of transmission wires, that we call a grid with different generators adding power to it, at different generating levels. That is all I did for a year of my career. The permutations are large, and you must calculate variable amounts of power being generated at generating stations as equipment comes online, or goes offline for repairs, maintenance etc.

    With an intermittant, non dischargeable power generation system, the problems of keeping a specific grid from starting to oscillate and sending or absorbing power on a specific transmission wire and overloading it grows astronomically. Generally 15-20% of intermittent power can be smoothed and stabilized by the other 85% of power being generated; but such is not always the case,

    Intermittent non dischargeable power wouldn’t be a bargain if it were 10% of the price of dispatchable generation,

    But it isn’t.

    Spain, Germany and even and T Boone Pickens discovered that in painful lessons,

    Despite this “levelized power propaganda” the intermittant sources cost up to10 times what you actually get from them. And that does not include the costs with beefing up the grid to provide better redundacy. Nameplate capacity, unlike dispatchable generation is a gross fiction. It is usually only a dreamy wish for the eco weenies’ renewable generation sources. in addition to the missing costs for actual generation versus the nameplate fantasies, the costs for grid extensions, real world experience says that 30 year financing cost for a 30 year lifetime are grossly over estimated, The UK has seen an average life of but 8 years for wind.

    The reality of that isthe numerous wind farms we see with only a few spinning turbines and lots of non spinning, abandoned, ones which would cost too much to fix, after only about 8 years of operation.

    Reality is quite different.

  142. What a shame. You use to be able to get good numbers from the US Energy Information Agency. Looks like CAGW politics have started to affect their numbers. In my opinion these numbers are way off because they are using some very basised assumptions. Too bad.

  143. len says:
    February 16, 2014 at 5:40 am
    So if you look at my bill which is locked in at 0.08$/kwh with 0.06$/kw
    +++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
    It’s worse than you think, Len. In Alberta cities you have a choice of electricity suppliers and rate plans. In the rural county where I live, you are locked in to one supplier and a regulated rate that varies with demand from C$0.07 per kWh to over 11 cents plus demand charges, transmission charges and “adjustments” that can bring winter electricity cost to over 18 cents a kWh in spite of the supplier quoting 8 to 10 cents. When you take your bill and divide by the kWh, it is a lot higher than the “published” rate.

  144. stas peterson says:
    February 16, 2014 at 7:16 pm

    Perhaps you have seen pictures of the Verazano bridge in Washington back in the 1930-40s. A little wind started the bridge oscillating and each breathe of wind added to it until the bridge was wildly swaying, Finally a bridge support snapped adding stresses to other supports, which soon failed also, and the bridge came crashing down,

    Minor correction, it was the Tacoma Narrows bridge: http://en.wikipedia.org/wiki/Tacoma_Narrows_Bridge_%281940%29

  145. All of the costs calculated ignore the environmental costs of the power. Without including the environmental costs all the discussion is meaningless. For example, the lifetime cost per kwh of the fukushima power plant just went off the charts. Averaged over the entire nuclear power production base, one fukushima sized accident every 25 years adds 0.10/kwh to every kwh of nuclear power generated.

  146. @ Norm B -
    Yes, that is yet another hidden cost of wind power, and it can also apply to fossil generation being constantly ramped up and down, as well as hydro. It’s like city traffic on a car’s engine, compared to highway driving. Excellent point.
    When will they ever learn? Presumably never, since ideologues are incapable of learning from experience.

  147. This report says one thing and one thing only: build more combined-cycle gas turbine power plants. What a coincidence, back in ’81 my first job out of the big U, Project Engineer on the very first one! Congratulations, yes, thank you all very much.

    It was a Westinghouse machine, 110 megawatts, Lake Charles LA, shed the last row of blades one day and titanium was raining down from maybe a mile in the air. Pressure sensor let go from some vibration. We all lived through it…

  148. Stas Peterson,

    Verezano Narrows bridge goes to New York City. Tacoma Narrows, the famous “Galloping Gertie,” definitive case of the structure’s natural frequency being far too low, in other words not nearly stiff enough.

    All Mechanical Engineers know this story…

  149. jai mitchell says:
    February 16, 2014 at 8:21 am
    The EIA LCOE analysis is flawed.
    NREL Estimates of LCOE for installed domestic wind in 2012/2013 BEFORE SUBSIDIES come in at 0.0675, the trend is that LCOE will continue to go down from there.
    ===============
    Great, that means we can end the subsidies and feed in tariffs for wind power, because it is now less expensive to build wind power than any other form of power.

    Only that isn’t happening. Instead governments are subsidizing wind farms and giving them long term price guarantees many, many times more than the average wholesale price. Even if there is no demand for the power they produce, the wind farms still get paid to produce, then someone else needs to be paid to dump the power so the grid doesn’t burn out.

  150. They use a capacity factor of 34% for onshore wind and 25% for solar PV both of which seem high.

    I acted as an informal consultant for a financial manager who wanted my opinion of various “clean” technologies. 25% efficiency for silicon PV is correct. I don’t know how the wind capacity factor is derived, so I have no opinion on that.

  151. It may be of interest to do some investigation of the Danish Grid. They have a major maintenance problem with the 6000 odd turbines installed, quite a few for 20+ years. During that time baseload generation (dispatchable) using coal has increased by around 40% to cover the low efficiency wind turbines. Most of the environmentally friendly renewable power generated by the turbines is sold to the eco-friendly people in Norway and Sweden. Apparently the maintenance/overhaul costs of the older turbines will be higher in real terms than the original installation cost, leaving the Danish government with a substantial problem.

  152. AP & Reuters at odds!

    13 Feb:San Jose Mercury News: AP: Huge Ivanpah solar power plant, owned by Google and Oakland company, opens as industry booms
    by Michael R. Blood/Brian Skoloff:
    “The Ivanpah project is a shining example of how America is becoming a world leader in solar energy,” U.S. Energy Secretary Ernest Moniz said in a statement after attending a dedication ceremony at the site. “This project shows that building a clean-energy economy creates jobs, curbs greenhouse gas emissions and fosters American innovation.”…
    The $2.2 billion complex of three generating units, owned by NRG Energy, Google and Oakland-based BrightSource Energy, can produce nearly 400 megawatts — enough power for 140,000 homes…

    http://www.mercurynews.com/business/ci_25134528/huge-ivanpah-solar-power-plant-opens-industry-booms

    13 Feb: Reuters: California solar plant greeted with fanfare, doubts about future
    by Rory Carroll/Nichola Groom
    One of the world’s largest solar projects, which uses heat from the sun to generate power in California, opened on Thursday but may be the last of its kind in The Golden State…
    Though Ivanpah is an engineering marvel, experts doubt more plants like it will be built in California. Other solar technologies are now far cheaper than solar thermal, federal guarantees for renewable energy projects have dried up, and natural gas-fired plants are much cheaper to build…
    The Ivanpah plant was partially backed by a $1.6 billion loan guarantee from the U.S. Department of Energy, the same controversial program that supported failed solar panel maker Solyndra…
    That means the private sector must fill the gap at a time when building a natural-gas fired power plant costs about $1,000 per megawatt, a fraction of the $5,500 per megawatt that Ivanpah cost…
    Ivanpah developer BrightSource Energy Inc has failed to secure a permit for any other solar thermal projects in California in part due to environmental concerns, including fears that the intense heat and energy around its plants would harm or kill desert birds.
    Ivanpah is jointly owned by privately-held BrightSource, power plant owner NRG Energy Inc and Google Inc …
    Late last year, Oakland-based BrightSource said it would focus increasingly on markets outside the United States and in using its technology for industrial applications like enhanced oil recovery, desalination and augmenting existing fossil fuel power plants…
    BrightSource is more than 20 percent owned by French power equipment maker Alstom SA. Other investors include venture capital firms VantagePoint Capital Partners and DBL Investors, Goldman Sachs Inc GS.N, Chevron Technology Ventures and BP Ventures.

    http://www.reuters.com/article/2014/02/13/solar-ivanpah-idUSL2N0LI1D420140213

    Kerry’s real agenda:

    17 Feb: Bloomberg Sangwon Yoon: Kerry Burnishes Green Badge in Asia as Volcano Disrupts Trip
    Climate change can also be an economic opportunity, Kerry said, adding that investment in “the global energy market of the future” is expected to reach nearly $17 trillion between now and 2035.
    In order to boost investments in the sector, governments must encourage greater innovation in renewable energy technology and check the use of coal and oil as power sources for their immediate energy needs.
    Kerry said the world “must look further down the line,” even as he acknowledged the challenges for developing countries such as Indonesia in developing alternate energy sources.
    “They have to factor in the cost of survival,” he said. “And if they do, they will find that the cost of pursuing clean energy now is far cheaper than paying for the consequences of climate change later.” …
    Kerry, who spent much of his Senate career fighting an unsuccessful battle for climate legislation, may be pressured to approve TransCanada’s Keystone proposal in a turn away from urging governments to do more to address climate change risks…

    http://www.bloomberg.com/news/2014-02-16/kerry-burnishes-his-green-badge-in-asia-ahead-of-keystone-call.html

  153. Jake J says:
    February 16, 2014 at 11:03 pm

    They use a capacity factor of 34% for onshore wind and 25% for solar PV both of which seem high.

    I acted as an informal consultant for a financial manager who wanted my opinion of various “clean” technologies. 25% efficiency for silicon PV is correct. I don’t know how the wind capacity factor is derived, so I have no opinion on that.

    I hope it was a very informal consultancy, because you seem to be conflating the capacity factor and the efficiency, which are very, very different things …

    w.

  154. RE: Tom J says:
    February 16, 2014 at 4:44 pm

    Hi, does anyone have a nice used 1961 Lotus Elite?

    Fast forward 50 years, and things are not that much better. I just replaced a pair of world class carbon fiber racing bicycles from Trek and Cervelo of 2006 and 2010 vintage due to cracked bottom brackets. Turns out, I had the audacity to want to train outside during the winter season in barely sub freezing temperatures, and the engineers had not worked out that the thermal expansion properties of the high-tech military-grade export-controlled carbon fibre frames did not match that of the imbedded aluminum tube that receives the threaded crankset bearings. Given enough thermal cycles, the bond between the frame and the bearing receiver fails. (Of course, I tell everybody that my 1.3 kilowatt sprint power was just too much for the bottom bracket to absorb … but those I race against know better.) Maybe titanium would have been a better choice?

    Too bad, as a little bit of global warming would have saved those two fine companies the warranty costs of a pair of shiny new frames. At least those engineers learned from their mistakes by eliminating the receiver tube. Both replacement frames now have bearings that seat directly into the carbon fibre bottom bracket shell. I will have to let you all know how it all works out next year, as this winter has been a total bust for outdoor riding. As I write this, I have 28 inches of snow pack in the back yard, and I am watching the great lakes next door freeze completely from shore to shore.

    All the same, even with the new bottom bracket design, I will still run for cover when the hail stones start to fall.

  155. -Complex life developed when oxygen became available to supply chemical energy through respiration.
    -Agriculture and cities developed when crops were utilised on a large scale to source mineral chemical energy from the ground when it also interacted with solar energy in photosynthesis in plants; animal husbandry also utilised chemical energy from plants on a large and controlled scale.
    -Civilisation and technology developed when metallurgy was developed to utilise various metals already concentrated by nature in the ground.
    -Industrialisation on a large scale developed when fossil fuels were utilised which were already concentrated by nature in the ground.

    All these are renewable and/or inexhaustible, except the last-fossil fuels. Something must be found that is largely inexhaustible and/or renewable to be as successful and dominant in the long run. Perhaps nuclear, but it is surprising just how much life in general and human society depends on energy utilisation and breakthroughs to flourish.

    The second one above-agriculture and animal domestication, are interesting in that they utilise both chemical energy from the ground and solar energy from photosynthesis in a complex interactive fashion, which perhaps suggests that some form of complex combination of energy sources will be developed which could make a huge difference in the future.

  156. thingadonta says … “but it is surprising just how much life in general and human society depends on energy utilisation and breakthroughs to flourish.”

    Not Really, streaming a little patch of ‘order’ out of the decay of the universe (entropy) takes a stellar effort :)

    • “Not Really, streaming a little patch of ‘order’ out of the decay of the universe (entropy) takes a stellar effort :)”….

      My compliments…One of the best.

  157. len says:
    February 16, 2014 at 6:44 am
    For all the CCS doubters, the penalty is not as high as you’d think relative to ‘Clean Coal’ and you can go to the SaskPower symposium in Regina in October after they’ve run it a couple months.

    Willis Eschenbach says:
    February 16, 2014 at 9:42 am SaskPower have no results yet, I’m unclear on the source of your confidence that the penalty is not high.”

    I am confident they will complete their project and run it and do a fair economic evaluation because like I say, they’ve been tinkering with it for years. There is a very old documentary with a Saskatchewan scientist working on stripping CO2 from flue gas but like the David Suzuki doc on the benefit of commercial vitamin supplements it is hard to find :) The main reason is they are a crown corporation with a mandate to use coal or any abundant under-utilized resource in their jurisdiction. Natural Gas is too valuable and portable relative to ‘generation quality’ coal.

    The penalty they were siting in the interview on BNN was about 10% and you have to add on the energy penalty of clean coal which is required for the chemical CO2 stripping which is another 5% and another 5% to run an old coal plant (close to some tech stuff I’ve heard from people involved in another related project that never got built). Add that to the potential future premium of natural gas at 6$/GJ and above and there is a possible economic case for coal with CCS. The one advantage of coal is it is not prone to price spikes just when you need it … and if you hedge out these gas price spikes, you lock in a relatively high premium so most businesses won’t do that … which brings me to those simple reciprocating engine installations. They might end up like the couple of nat gas peaking stations which were never run and are now being demo’d because of a decade of abundant hydro power in the region which ‘just in time’ is now over … I digress.

    What about renewables? They will always be a marginal consideration. Nuclear could do more but there is only so much uranium. When we perfect fusion power, which now seems possible, then there will be an alternative. By then (given we are smarter in a number of aspects) we may want to more actively take part in the carbon cycle and maintain 500-600 ppm of CO2 in the atmosphere which may be difficult given the natural sequestering processes.

    • 25-30% parasitic loss on capture is not small bananas in a 600 mw unit.

      But as I posted before, UNLESS the CCSis literally sitting on top of an EOR field, CCS is meaningless. The regulatory gauntlet to accomplish long distance CO2 transport and sequester in suitable geology is improbable at best and is literally decades away.

      CCS without EOR is a regulatory box canyon and The enviros are licking their chops at the prospect of that battle.

  158. Willis,
    You said that each non-dispatchable power source you need to add at least 7 cents to the levelized cost. That is not exactly accurate. The levelized cost includes the cost of construction, maintenance, and fuel. In gas and coal plants the fuel is the lion’s share of the operational cost. If the reserves are spinning at low output much of the time then the $0.07 would come down significantly to probably $0.03-$0.05. In other words, if you build 100MW of wind and 100MW of back-up NatGas and sell 2GWh over the life time with 1GWh from wind and 1GWh from NatGas then the backup cost to wind is the total cost of the NatGas system minus the revenue generated by selling electricity from the NatGas plant. The simple bold statement you make assumes that the 1GWh from NatGas is given away for free.

    Also, you group hydro with other non-dispatchable sources. That isn’t exactly fair since (according to your own article) hydro is dispatchable part of the year. So, in that case the hydro probably needs a lower estimate, or can be taken as dispatchable but seasonal.

    Also, desert solar systems while not dispatchable are (if sited correctely) daytime base-load appropriate since their output characteristics are well known. This is similar to many coal stations that are not actually dispatchable since they cannot be quickly ramped up or down to meet demand.

    Taken together, I could easily imagine cutting the add-on price for renewables to $0.03/kWh or less if the grid included hydro and solar along with cycling power plants designed to ramp up and down each day (the type already on the grid) that run during dry seasons in a manner to offset solar. These plants (again) are already on the grid, we would only shift when their output is ramped on or off. While the cost is still higher than traditional sources some risk components (nat-gas price spikes) are reduced since fuel is no longer as much of a limiting factor (Nat-gas still affects the peaking plants, but much of the baseload is insulated from fuel costs). Diversification is typically desirable whenever possible, and adding this sort of resiliency may be beneficial overall.
    Not saying that a 100% green system is ideal, or even desirable, just saying that a $0.07 add on to all non-dispatchable sources is an overestimate. Or possibly disingenuous, although given your track record of being truthful and charitable I am guessing overestimate is the right descriptor.

    However, as already pointed out repeatedly in the comments the transmission costs from appropriately sited renewables to demand centers raises the total cost by likely as much as I accused you of overestimating (5 cents or so per kWh) thereby making my entire objection moot.

    Looking at the chart though I am surprised not to see greens pushing for more offshore solar-thermal. “It’s free, and it keeps the birds safe, what’s not to like man?”

  159. Willis, thanks again for a wonderful article. You may not have written the “Emperor Has No Clothes Story” ( I think Al Gore did before he invented the internet and when we had a Republican president and Republican majority in Congress), but you sure prove its truth over and over here on WUWT. Please keep up the excellent and informative work. Work such as yours is critical to fighting fuel poverty and to help developing countries get the cheap, reliable energy the need to lift themselves out of poverty. A worthy goal for everyone with both a heart and a brain. Lead on!

  160. thingadonta says:
    February 17, 2014 at 3:33 am

    All these are renewable and/or inexhaustible, except the last-fossil fuels.

    ============================================================

    I assure you that they are inexhaustible. I will be long dead when fossil fuels are unavailable to Man. The condition of Man 1000 years from now is of no interest to me. Double-ought zero.

    Solar energy will be unavailable to Man in 4 billion years. 1000 years, or 4 billion years, there is no distinction to me.

  161. Where is this stupid comment “there is only so much Uranium” coming from? That has got to be one of the stupidest comments I see on these sites. If the USA reprocessed its slightly used uranium and used that reprocessed fuel with what we already have in the USA we would have enough for another thousand years. Presently we only burn about 5% of the fissionable uranium in the fuel rods. More than 90% of the fuel can be recovered and that can be done again, again, again, and again (About 10 more times). Actually costs less than digging it up. Then we have all of the “Bombs to Power” B/S of mixing in all of the decommissioned bombs into nuclear fuel. That alone is driving down the price of uranium to the point it is not worth looking for any. And just last week, Iraq claimed they discovered another LARGE deposit.
    They are finding new deposits of uranium every year, and they only thing preventing mining is that the price is presently not high enough to waste the money on digging it up. If and when that runs out, the ocean has uranium that is recoverable.
    And then in 500 or 1,000 years perhaps they will finally say that Fusion is making economical power, rather than saying it will be in ten more years like they have for the last 50 years.

  162. Why must you add 7c to the wind power or solar power cost?
    You should only have to add the infrastructure cost portion.

  163. I’ve looked at EIA numbers before, and it seems that the EIA also includes subsidy benefits into the levelized cost. Thus the numbers above are significantly skewed by the massive construction and operation subsidies that have been extended to solar PV/geothermal and wind.

    Granted, the natural gas and what not also have subsidies, but from what I saw – the relative impact on cost per output kW is small because construction costs play such a huge role in solar PV/geothermal and wind whereas the primary cost factor in coal and natural gas is fuel cost.

    Yet another accounting scam.

  164. As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there, so you’ll have dispatchable power when you need it. Otherwise, the electric power will go out, and you’ll have villagers with torches … and pitchforks …

    The $0.07/kW-hr number is the steady state performance of the combined-cycle natural gas plants. During start-up, stand-by, and shut-down you don’t have enough heat in the stack for the steam side of the process to work, so the actual performance is closer to $0.14/kW-hr. That is what you need to add to the prices shown.

  165. Ed says February 16, 2014 at 9:06 pm

    All of the costs calculated ignore the environmental costs of the power. Without including the environmental costs all the discussion is meaningless. For example, the lifetime cost per kwh of the fukushima power plant just went off the charts. Averaged over the entire nuclear power production base, one fukushima sized accident every 25 years adds 0.10/kwh to every kwh of nuclear power generated.

    What was the one-time cost of the Tsunami?

    Had Fukushima ‘blown up’ by itself (though direct human action, for instance), I might agree with you … ‘acts of God’ (re-read your insurance policy) are another thing.

    .

  166. sergeiMK says February 17, 2014 at 4:25 am

    How the UK grid handles a 1GW diconnection of a Nuclear generator (only 5 minute data available)

    Any indication of the instantaneous drop in grid frequency at that time? How long it took to recover?

    .

  167. stas peterson says February 16, 2014 at 7:16 pm

    That is exactly what happens on a grid, with power sloshing back and forth until a circuit breaker trips or a transformer blows on a grid transmission wire over loading the others, until there is a cascade of failures, and blackout.

    One of the biggest fears here is damage to the ‘rotational’ (rotary or spinning) gear (equipment) … heaven forbid if an out-of-phase condition should occur and massive currents flow for a moment and ‘wire’ (in stators and rotors) are momentarily stressed, sometimes inducing physical damage (jerking, stretching, shearing etc.). This can be seen most dramatically in those cases where operators failed to ‘observe their (phase indicating) lamps’ (synchroscope) and ruined a generator they were trying to bring synchronously on line …

    Power Plant “Horror Stories”

    http://www.beckwithelectric.com/docs/tech-papers/pphoror.pdf

    .

  168. Wayne Delbeke says February 16, 2014 at 7:58 pm

    It’s worse than you think, Len. In Alberta cities you have a choice of electricity suppliers and rate plans. In the rural county where I live, you are locked in to one supplier and a regulated rate that varies with demand from C$0.07 per kWh to over 11 cents plus demand charges, transmission charges and “adjustments” that can bring winter electricity cost to over 18 cents a kWh in spite of the supplier quoting 8 to 10 cents. When you take your bill and divide by the kWh, it is a lot higher than the “published” rate.

    Electric ‘retailers’ (the middle men between the consumer and the distribution operator and the independent generators) have begun charging a ‘distribution’ charge … this amount used to be ‘eaten’ by someone in past years, but, our PUC (Texas) now allows this separate 30 some dollar (and scaled based on usage) charge to be tacked onto the bill too. ‘Quoted’ rates per kWh from retailers does not, of course, include this scaled charge.

    .

  169. Hoser wrote at 8:16 on Feb 16:
    “That means the turbines need to be built off shore. 1250 sq miles translates to 500 miles of coastline with 7 or so rows of turbines from the shore out to sea covering a band 2.5 miles wide.”

    Talk about climate change! Who really believes that such a wind sink will have little effect on the onshore winds that make the Southern California coastal climate so livable? Diminish that wind and you will have higher temperatures, which will result in higher air conditioning cost and less livability for those very elites that support this folly. Plus, what will it do to their beautiful coastal views?

    And that is only the easily foreseeable effect. The law of unintended (or unforeseen) consequences applies. Free lunch is always prepared with a major portion of unobtanium.

  170. Interesting the differences between actual historical costs and projected costs of generation. Here’s some historical data:
    “August 2003 figures put nuclear costs at EUR 2.37 c/kWh, coal 2.81 c/kWh and natural gas at 3.23 c/kWh (on the basis of 91% capacity factor, 5% interest rate, 40 year plant life). With emission trading @ EUR 20/t CO2, the electricity prices for coal and gas increase to 4.43 and 3.92 c/kWh respectively” Generation figures for nukes include decommissioning costs, unlike other generation sources.

    Source: http://www.world-nuclear.org/info/Economic-Aspects/Economics-of-Nuclear-Power/
    Unlike government projections, industry data needs to be accurate. Nukes and coal are the lowest cost, which is why real-world power generating companies have been buying them.

    But then along comes requirements for ‘renewables’ and a US President who campaigned on a platform of “Under my plan, electricity rates will necessarily skyrocket” Reference: http://www.youtube.com/watch?v=HlTxGHn4sH4

    So now we live in a world where China is building dozens of 3rd generation nukes that were designed in the USA with 100,000 years of fuel available, especially if you include the Japanese demonstration of collecting Uranium from seawater. But very little new construction in the US or much of the Western world.

    I guess zero radiation-related injuries or fatalities at Fukushima after the tsunami claimed tens of thousands of lives just isn’t good enough.

  171. len says:
    February 17, 2014 at 6:02 am

    len says:
    February 16, 2014 at 6:44 am

    For all the CCS doubters, the penalty is not as high as you’d think relative to ‘Clean Coal’ and you can go to the SaskPower symposium in Regina in October after they’ve run it a couple months.

    Willis Eschenbach says:
    February 16, 2014 at 9:42 am

    SaskPower have no results yet, I’m unclear on the source of your confidence that the penalty is not high.”

    I am confident they will complete their project and run it and do a fair economic evaluation because like I say, they’ve been tinkering with it for years.

    Thanks for your reply, len, but it doesn’t even begin to answer my question. Try again. I asked why you are confident that the economic penalty for CCS is not high.

    You answered, because you think they will do a “fair economic evaluation”, and because “they’ve been tinkering with it for years”.

    So freakin’ what? What does that have to do with my question?

    Neither of those should give you confidence that the CCS will be cheap enough to work. To the contrary, the fact that they’ve been “tinkering with it for years” should make you immediately nervous …

    Len, I have to say, I find your kind of blind cheerleading for a technology that even you admit has not been tested to be bizarre. Let me suggest that you actually wait for sunrise before you start crowing about SaskPower. To date they have zero results, and that should engender zero confidence.

    w.

  172. David Simpson says:
    February 17, 2014 at 8:16 am

    As a result, for all of the non-dispatchable power sources, those gray bars in Figure 1, you need to add at least seven cents per kilowatt-hour to the prices shown there, so you’ll have dispatchable power when you need it. Otherwise, the electric power will go out, and you’ll have villagers with torches … and pitchforks …

    The $0.07/kW-hr number is the steady state performance of the combined-cycle natural gas plants. During start-up, stand-by, and shut-down you don’t have enough heat in the stack for the steam side of the process to work, so the actual performance is closer to $0.14/kW-hr. That is what you need to add to the prices shown.

    David, you’re likely correct. However, in what I write, I have to be mindful that I need to be able to defend it. As a result, I tend to underplay my claims, and make my numbers err on the conservative side.

    That way, when someone claims that the $0.07 is too much to add to the non-dispatchables, I can come back and patiently explain (as you did above) that the actual costs will likely be larger, not smaller …

    w.

  173. Richard says February 16, 2014 at 6:17 pm

    A most excellent discussion. I have also spent my entire career in the electric utility industry trying to explain the folly of grid-connected intermittent resources and the games …

    Do you recall in the early days the ‘test bed’ GE used to have to demonstrate the intersection of theory and practice which concerned itself with grid stability? In the ‘days’ prior to computer simulation any way, back in Charles Steinmetz (the REAL father of AC) days …

    • Jim I do indeed recall the good old analogue days when a model of an electric system provided a much better intuitive feel for power flows and dynamic stability issues ( just as a slide rule assisted in a better grasp of math than a calculator). Unfortunately very few people outside of electric power industry planners still understand how precarious that stability is, or the cost of building in the balances necessary for sources that can change as rapidly as wind. Those inside the industry have been silenced by political fear of the carbonphobia lobby.

  174. len wrote, “renewables… will always be a marginal consideration. Nuclear could do more but there is only so much uranium.”

    There’s an effectively infinite supply of thorium, which also works well, and which, coincidentally, is in the news just now. Also, Forbes had an interesting article two years ago:

    len: “When we perfect fusion power, which now seems possible, then there will be an alternative…”

    I doubt that fusion will ever be a practical alternative to uranium or thorium fission. I’d love to be wrong. But thorium sounds pretty good.

    Len: “By then… we may want to more actively take part in the carbon cycle and maintain 500-600 ppm of CO2 in the atmosphere which may be difficult given the natural sequestering processes.”

    Agreed. As I just wrote on the only climate alarmist blog I’ve found that doesn’t censor polite dissent, “it’s doubtful that we can maintain current rates of CO2 production for even the next one hundred years. / Before this century is done, if mankind is still around, we’d better hope that reliance on fossil fuels will be declining, and reliance on longer-term energy sources, such as thorium, will be increasing. There’s simply not enough fossil fuel in existence to run civilization forever. / The long term “CO2 problem” isn’t going to be global warming due to too much CO2 in the atmosphere. It’s going to be diminishing agricultural productivity due to declining CO2 levels, as the Earth’s flora consume and sequester it, after mankind ceases burning [fossil fuels], and relies, instead, on other forms of energy.”

  175. If I hear one more “useful idiot” say that wind is free, I’m gonna laugh hysterically and directly in their face.

    By that definition, coal is free. All you have to do is dig it up.
    By that definition, gas is free. All you have to do is drill a hole in the ground and it comes right up.
    Hydro is free. Just put a turbine at the bottom of a hill, and let the good times roll! Mother nature takes the water up the hill for free in the form of rain.

    So ‘wind is free’ eh? …

    All you have to do is build costly and unsightly windmills and stick them up all over pretty places, and THEN build an equal capacity of rapidly dispatchable conventional (coal, hydro, petroleum, etc) energy producing infrastructure that you don’t REALLY want to build just in case the wind doesn’t blow, and according to the numbers this is about 75% of the time? AND – When the windmill falls over it has to be removed. Has the cost for this been factored in? AND – it costs 4-5 times as much as coal and hydro?

    Do I have the main points summarized correctly?

  176. Gail Combs says February 16, 2014 at 5:56 pm

    Get your diesel generators and supply tanks now before the rush folks.

    It would be beneficial at this point, if, when selecting a generator, that it be *sized* correctly for the motor starting loads one wishes to power during time ‘off the grid’; even starting a common household fridge with a smaller genny seemingly rated to *run* a fridge may _not_ start that same fridge’s induction-motor based compressor. There are a few tricks that can be used with a smaller generator to *start* a demanding motor load, such as powering up an unloaded induction motor spinning a bit of mass, which becomes a temporary inertial-mass powered ‘generator’ for the short period of time the heavier compressor load ‘pulls’ high current during start-up … particularly heavy loads include central air conditioner compressors; have a study or test performed (or at least look at the generator ‘surge’ ratings) by qualified personnel before spending the big bucks on a generator!

    .

  177. Oops … mea culpa; a re-do b/c of a formatting snafu …

    Gail Combs says February 16, 2014 at 5:56 pm

    Get your diesel generators and supply tanks now before the rush folks.

    It would be beneficial at this point, if, when selecting a generator, that it be *sized* correctly for the motor starting loads one wishes to power during time ‘off the grid’; even starting a common household fridge with a smaller genny seemingly rated to *run* a fridge may _not_ start that same fridge’s induction-motor based compressor. There are a few tricks that can be used with a smaller generator to *start* a demanding motor load, such as powering up an unloaded induction motor spinning a bit of mass, which becomes a temporary inertial-mass powered ‘generator’ for the short period of time the heavier compressor load ‘pulls’ high current during start-up … particularly heavy loads include central air conditioner compressors; have a study or test performed (or at least look at the generator ‘surge’ ratings) by qualified personnel before spending the big bucks on a generator!

    .

  178. I can’t determine several key assumptions used in the National Energy Modeling System (NEMS) used to produce these figures.
    Tax breaks and subsidies for renewables
    The AEO2013 Early Release Overview linked to the post has a note below Table 1 that reads:
    “These results do not include targeted tax credits such as the production or investment tax credit available for some technologies, which could significantly affect the levelized cost estimate.”
    BUT when I follow the link for Assumptions given in Footnote 3 on that same page, and follow the link on that page to a PDF document(PDF) I read:
    “The Renewable Fuels Module (RFM) … Investment tax credits (ITCs) for renewable fuels are incorporated, as currently enacted, including a permanent 10-percent ITC for business investment in solar energy (thermal nonpower uses as well as power uses) and geothermal power (available only to those projects not accepting the production tax credit [PTC]
    for geothermal power).”

    So which is it? Do the figures include the effects of tax credits or not? The documents that EIA references contradict their text.

    I am unable to find any discussion of plant lifetime. (It may be linked somehow but I don’t find it.) Nuclear, coal, and hydro plants have demonstrated lifetimes of many decades. Solar and wind plants generally CLAIM 20 year operational life, but to be charitable, the data is not available to support those claims. A skeptical person might note abundant evidence of both solar and wind farms failing well before their projected lifetime.

    For a levelized metric, a poor or unrealistic choice of plant lifetime will have a very large effect on the results.

  179. Good post; the numbers are similar to the UK numbers, so no big surprises. 2 points.

    1) Gas back-up for the wind won’t be at 7c/KWh; as others have pointed out these backup plants will be run sub-optimal (about 70% load, but some days 0% load). This actually has quite bad implications for levelised cost, as well as being plain inefficient. A back-of-envelope suggest that it would actually cost about 10c/KWh for 1:1 backup.

    2) I don’t believe the maintenance costs of wind either. Also, they should pay a much high connection cost than conventional power statons; wind is inevitably in the middle of nowhere and the juice has to be carried long-distance. There are additional stability management costs as wind >30% of total system which also aren’t represented.

    • Good points Alistair. A lot of transmission must be built to integrate wind turbines. This goes far beyond the immediate radial extension necessary to connect the individual windfarm, and involves a deeper reinforcement of the network to accomodate the big swings in power output that can cause area reliability problems with voltage swings etc. The cost of this extra transmission is rarely recognized for political reasons ( nobody wants to appear to be against wind/motherhood) yet represents major investment effectively unused 70% of the time.

  180. Two other interesting points about the levelized cost as presented in Table 1 of
    AEO2013 Early Release Overview
    Capacity Factor:
    For coal, oil, nuclear, and baseload natural gas (natural gas peaking plants are operated intermittently) the capacity factors range from 85% to 90%. Solar and wind have capacity factors ranging from 20% to 37%. Previous commentators have alluded to the rambunctious skepticism appropriate for even these low numbers.

    Whatever you think of solar and wind versus coal, oil, an gas, and nuclear, if you want your energy from wind and solar you need to build roughly 3 times as many plants to produce the same amount of energy. Whatever their environmental, social, aesthetic, and financial costs, you pay them thrice – THEN you buy a backup plant that uses reliable technology and so can be dispatched when required.

    Transmission costs:
    Note the the transmission costs in Table 1 for baseload coal, oil, gas, and nuclear range from 1.1 to 1.2 $/megawatt-hour. That figure is so low because these plants tend to be big, and the costs per megawatt-hour of building new transmission infrastructure goes down as power levels go up. The transmission costs for solar and wind range from 3.2 to 5.9 $/megawatt-hour.

    It costs roughly as much to dig a hole and set a pole for a 20 MW solar plant as for a 1200 MW nuke. Right-of-way, permitting, design costs don’t change dramatically as power levels increase, so smaller plants spend more per unit of delivered energy.

    Here’s the thing about transmission lines: most people don’t like them. Intense political and legal battles ensue whenever new lines are proposed or (much more rarely) constructed. As with capacity factor, the smaller scale of solar and wind technologies mean that they need more poles, holes, wires, and right-of-way (much of it seized via eminent domain proceedings) than the comparable baseload generation technologies.

  181. Willis Eschenbach, fair enough. I have been working with an Oil & Gas industry group on comments to some issues with the so called “Clean Air Act”. From an air-emissions viewpoint, the start-up/standby issues with using a combined cycle for anything but a narrow “steady state” band (i.e., nominal +/-15%) had a really large impact on the garbage (NOx, CO, and VOC) that got dumped into the air–to the point that the existence of the wind farm actually increased the total emissions over the exact same plant without the wind farm. I haven’t done the same analysis on cost/kW-hr (since the EPA has no interest in cost numbers at all), so you are probably right to assume that the combined cycle plant is as efficient in standby as steady state even though it significantly understates reality.

  182. David Simpson says February 17, 2014 at 2:22 pm

    (since the EPA has no interest in cost numbers at all)

    This has got to stop; I was under the impression that a cost/benefit analysis was part of their consideration when making proposed rule?

    Is this not the case?

    .

  183. Alistair says February 17, 2014 at 1:58 pm

    Also, they should pay a much high connection cost

    They should pay the TOTAL cost for implementation of the transmission lines to a facility! Do other ‘owners’ of competing generation plants bear the cost of lines to their plants?

    Goose – gander – fair.

    .

  184. Willis,

    The figures are fake. The cost of electricity retail is about 7c/kWh in PA, so in no way could the cost of PRODUCING that electricity be 7c/kWh as in the EIA. It is more like 3.5c/kWh.

    What the EIA costs are is what energy WOULD cost if cap-and-trade and similar laws were passed. Resulting in a doubling of retail price.

    With the population at large not noticing this doubling and voting those who passed such laws back into office.

    Thus the energy is “levelized”, or the whole matter is run over by a steamroller.

    The Energy Fairy which giveth us free unlimited baseline energy is much more credible than the above scenario.

  185. Truth Disciple says February 16, 2014 at 7:09 am

    Chemical Engineering Chair, Lehigh University Professor John Chen, did an Energy Assessment for the globe some years ago. I suggest you read it because it stresses the importance of nuclear power. It implies we are wasting ENERGY & TIME on the alternative intellectual masturbations. It was written before the Balken and Marcellus NG finds. Available on his website or Lehigh’s.

    One may be slightly distressed to see this item: Dr. Professor Emeritus John C. Chen passed away in late December 2013.

    I am unable to find any references to a work published by him specifically regarding nuclear and ‘Energy Assessment’ for the globe save for a slide presentation and talks that were pretty much run of the mill …

    .

  186. Jim, The EPA is required by law to do a cost benefit analysis on new regulations and they do. Problem is they use benefit data from the eNGO’s and cost data from Energy Star. Energy Star is an EPA program where companies publish environmental successes. The Energy Star success stories are generally a tiny sample (dozens of wells usually) in a perfect environment for success and end up with generally low costs (when the company environmentalists are in control of projects, the project costs tend to not rigorously hit the project, enviro’s just are not project managers). When you try to scale any of the costs up you find that the numbers don’t scale up (e.g., one program said that the idea cost $5k/well and had a benefit of $50k/well/yr on the 9 wells tested, the idea was moved to 100 wells in another field and the costs were $85k/well and the benefits were $800/well). Energy Star leads to a one-size-fits-all regulation and outrageous economics.

    One company posted a success in Energy Star where they went to 700 wells in one basin and instead of venting the wells to unload water they installed downhole plungers. There are 30,000 wells in that basin and the study was done on 700 cherry picked wells. Great Success. When EPA decided to control emissions on wellsites (Subpart OOOO) one of their big ideas was that every gas well must have a plunger installed. When we pointed out to the EPA that nearly half of the 500,000 gas wells in the US have downhole pumps and nearly 3/8 were free-flowing without the need for venting or plungers, we were able to get that particular rule exorcised (but the eNGO’s promptly sued the EPA [unsuccessfully] to reinstate it). We estimated the total cost of Subpart OOOO to be nearly 1,000 times the EPA estimate and the benefits to be 1/100th of their benefit estimate. Industry groups were able to get rid of a considerable amount of counter-productive nonsense, but not nearly all.

  187. I hope it was a very informal consultancy, because you seem to be conflating the capacity factor and the efficiency, which are very, very different things

    Not five minutes after I posted my comment, the same thought occurred to me, and I cringed. “Capacity factor” isn’t a parameter I considered at the time. That much said, and, uh, very informally, it occurs to me that solar’s predictability makes it an easier input to deal with, at least on a day-to-day basis when it’s installed in sunny places.

    I have plenty of mixed views of solar and wind, especially the latter. Grid-scale storage is the holy grail, but we’re not there yet. But it seems that solar could be at least a worthy peak-period source, at least in principle.

    Back to my informal consultancy, my role was simple. To render am opinion on whether PV panels work, with “work” defined as “delivering power at a cost-competitive rate. I concluded that this parity would likely be reached in the American Southwest between 2015 and 2020. I made this prediction in 2007, and I feel pretty good about it, considering the difficulty of predicting technology adoption and costs.

    I also predicted that wind would “work,” which has been shown to be true, the intermittentcy issues notwithstanding. I gave a thumbs-up to ground source heat pumps, something that has gotten far less glamor but which I said was the lowest-hanging fruit. Within a couple of years of making that call, I noticed that these things were appearing at home shows along with the rest of the HVAC solutions. I still think this is underplayed.

    I went thumbs-down on wave and tidal power. At the time, I thought that these were little more than excuses to obtain research grants, sort of like nuclear fusion but with even less basis. That one has turned out to be correct too, at least so far as I know. Anyway, “capacity factor” is interesting to me; it was beyond the scope of my inquiry at the time, but I’m interested in everything.

    Also, since then, I’ve learned more about the operational limitations of solar, as in “keep your panels clean and free of shadows.” And don’t get me started on Germany’s bribe to the Greens. Finally: I know more than I’m letting on. My basic role then was to tell the financial manager whether he was being a complete fool by considering this or that subsector.

  188. There IS roughly 20 nuclear reactors worth of power of storage in the US.

    http://en.wikipedia.org/wiki/Pumped-storage_hydroelectricity

    Pretty much more than “not an iota of storage”, don’t you think ?
    Moreover, if “the power grid is a jealous bitch”, well, you just have to pay to have her do your wishes. I mean : change the price, each hour, up when non dispatchable are off, and you’ll see a lot of the demand disappear, to come back next hour when the price goes down because non dispatchable are on. Electricity is used in a lot of applications that can be switched on /off, depending on the price of power, by ad hoc electronic devices already available for a decent price.
    Finaly, “the backbone of the generation mix” is NOT made of dispatchable source, but I won’t repeat Bob Greene at February 16, 2014 at 6:24 am, he says it all.

  189. Jeremy @ SmartPowerShop says February 18, 2014 at 4:19 am

    What a shame it is that the energy companies can effectively hold consumers to ransom and charge whatever they like.

    An assertion that falls short given facts; you are as free as the next man to seek and implement alternative sources of energy to cause electrons to ‘flow’ in your ‘wires’, from solar to wind to your own natural gas-fueled 60 Hz 3-phase generator, if you so desire. The thing is, the ‘price to beat’ will be that offered by those ‘evil’ energy companies you just condemned, as they usually (there are exceptions) generate electrical power at scales (sizes) that work out to be the most economical.

    .

  190. @paqyfelyc, I followed your link. It claims that there is 127 GWh (127 billion watt hours) of pumped storage capacity “available” worldwide. Sounds like a lot, doesn’t it? Better think again. The U.S. generates 4 TWh (4 trillion watt hours) of electricity every year, and the world somewhere between 20 and 25 TWh.

    This would make worldwide pumped hydro storage represent 0.5% of energy output, or 3% of U.S. output. But lets look more closely at the U.S., where according to the Energy Information Administration, we have 4 to 5 GWh of pumped hydro storage, representing about 0.1% of total output.

    http://www.eia.gov/totalenergy/data/monthly/pdf/sec7_5.pdf

    Then there is the cost of building pumped storage. I’ve casually looked into it, and am confident that the costs are very high. If I get a challenge here I’ll go run down the number. I believe that adding pumped storage raises the cost of generation about four-fold, but hasten to add that this is a guess from memory and could be wrong.

  191. Jake J:

    I support all you say in your post at February 18, 2014 at 2:25 pm but I write to provide a clarification to one of your points.

    You rightly say

    I believe that adding pumped storage raises the cost of generation about four-fold, but hasten to add that this is a guess from memory and could be wrong.

    Yes, but you failed to add that this high cost is worth paying because it removes the higher cost of building, maintaining and operating power stations solely to provide electricity at times of peek demand.

    Richard

    • The reason that there is so little pumped storage is that it is generally far cheaper to build excess conventionial generating capacity, especially gas turbines. Pumped storage is expensive, inefficient and feasible sites are hard to find..

  192. I think solar is a much better way to go for peak power. I think grid-scale storage likely awaits breakthroughs in large batteries. Pumped hydro has an engineering elegance, but the costs are very high.

    • Really? Suppose the utility demand peaks on winter evenings with lighting and heating loads. How does solar power help?

  193. Here is an Energy Information Admin report comparing costs of the various generating methods. I think there is a lot here to provide encouragement for wind (land-based, anyway) and solar. Storage is certainly the holy grail, but even without it you have attractive numbers.

    • Jake, the basic problem is that electric systems must be blanced in real time to work at all. This is not just a matter of adjusting demand to match supply as one might do with a natural gas or telephone utility. Wind and solar generation could essentially be offered free of charge, but the cost of collecting, storing, controlling and delivering the output to provide the reliable and constant supply demanded by society would still render the costs prohibitive. That is the thrust of this entire thread of comments.

  194. Richard, I was thinking of summer afternoons when A/C kicks in. Solar makes plenty of sense for meeting that peak demand. It’s well suited to that use, as a supplement. It’s certainly not base load capable without storage.

  195. Jake,
    Willis Eschenbach made some mistakes, i just aimed at putting things right. For sure pumped storage is not perfect. But it does exist and works. And it is pretty cheap, actually : more or less the price of hydro power. Batteries have at looooooong way to go to be as cheap.
    But Richard ( February 18, 2014 at 3:47 pm) give the point : for roughly the same price, a generating capacity that produce new power beats any storage utility ; without the green hassle

  196. paqyfelyc says:
    February 19, 2014 at 2:22 am (Edit)

    Jake,
    Willis Eschenbach made some mistakes, i just aimed at putting things right.

    paqyfelyc, I do love how you accuse me of making some vague unspecified “mistakes”.

    If you think I made mistakes, how about you QUOTE MY WORDS LIKE I POLITELY REQUESTED, instead of you looking like a fool for just standing there and throwing mud at me …

    w.

  197. Correct me if I have a misimpression, but the drift I’m getting here is that non-dispatchable power sources are useless. I will admit that, when I researched solar and wind (and others, including wave power, which I rejected as unable to even recapture the energy used to make the machinery let alone pay back the cost of the equipment) I didn’t study the grid’s ability to use the power.

    I assumed that the grid could use these electrons. This seemed like a safe bet at the time (and still does with solar), given how small a share of power would come from these sources within the investment time horizon that I was dealing with.

    More recently, I’ve noted issues with handling wind generated power. In particular, at certain times of year, i.e., during some periods in winter, the wind farms on the Columbia River need to be shut off because, in combination with the dams, there’ll be too much power for the grid to handle.

    I admit that this is perplexing. Maybe if the same financial group ever sees opportunities to make grid investments, I’ll study that side of things. I realize that my language here is conversational and imprecise, and will lead some other commenters to think I’m sloppy and unqualified. All I can tell you is that I focus on materialiality, not (usually, anyway) the fourth number to the right of the decimal point, and that I deal with people who have depended on my to translate the science into everyday English.

    I feel very good about the calls I made on wind and solar, and about my views on storage. The grid definitely interests me. I have trouble believing the implications in some comments here to the effect that non-dispatchable generation is useless. At a VERY shallow level, my VERY cursory reading indicates otherwise. Wind generation looks like it’s growing at a rate of about 25% a year in the United States and is now 4% of the total; solar is growing much faster (more than doubling each year) but from a much lower base (0.2% of the total).

    I could imagine the utilities nodding and winking at solar for nothing other than p.r. purposes given such low penetration, but not at wind when it’s at 4%. Perhaps this site will have more to say about the electrical grid in other posts. I’ll conclude by saying that, even though I’m in favor of renewables in general, it’s for reasons other than climate change, which I consider to be an unproven hypothesis.

  198. Jake J:

    At February 19, 2014 at 2:02 pm you say

    I’ll conclude by saying that, even though I’m in favor of renewables in general, it’s for reasons other than climate change, which I consider to be an unproven hypothesis.

    That puts you in the same camp as most people who favour ‘renewables’: their “reasons other than climate change” are subsidies.

    Richard

    • Jake,
      The sole reason that so many wind-turbines are interconnected with utilities is the worldwide pandemic of misguided “green’ legislation forcing utilities to buy renewable energy through mechanisms such as “renewable portfolio standards” and hugely inflated “feed-in” tariffs Windturbines (or solar) would not otherwise be the choice of utility engineers, due to their intermittent, non-dispatchable output and the high cost of connecting this diffuse energy with a system that must remain stable every minute in terms of area voltage and power delivery. It is the cost of converting this constantly varying output into a stable supply through excess transmission, control and storage sytems that makes it virtually useless in practice ( as opposed to academic theories from Stanford). Dont take my word for it, here is a quote from James Lovelock, father of “Gaia” himself:

      “You’re never going to get enough energy from wind to run a society such as ours,” he says. “Windmills! Oh no. No way of doing it. You can cover the whole country with the blasted things, millions of them. Waste of time.” (The Guardian March1st 2008)

      Cheers,
      the other Richard.

  199. PS

    Jake,

    The bottom line is that there would be no significant grid-connected wind or solar sources absent the legislation, massive subsidies and tax incentives that mandate or financially encourage these dreamy but unrealistic renewable fantasies.

    Mobile or geographically isolated applications where a renewable source ( especialy more dependable hydraulic generation) displaces high cost fuels such as air-lifted diesel, or avoids expensive transmission extensions can justify the cost of contorl and storage systems ( for example temporary highway signs, sailing boats, remote cottages or villages).

  200. @Richard, I’m more open-minded on your objections than I might sound. As I wrote above, when I studied the so-called “clean tech” stuff, I played economist and assumed that the grid could take the power. I am all ears when it comes to learning more about the capabilities and limitations of the grid.

    You can imagine, I hope, and sympathize, I hope, with me when I say that mere assertions plus $2.79 will buy an iced grande Americano here in Seattle. But if you would like to point me to neutral engineering discussions about the grid’s ability to incorporate non-dispatchable power, I assure you that it will get my close attention and appreciation.

    To me, there’s no denying that the extraction of coal, gas, oil, and uranium is environmentally destructive. (And I might add, I also regard wind turbines as a blight on the landscape, and increasingly worry about that underplayed issue.) There are reasons other than climate change to seek alternatives to extractive energy.

    Unlike the “usual suspects,” though, I’m not a devotee of the hair-shirt school of life, nor do I have the oh-so-righteous complex about Exxon and all the rest. I view a “switch” to renewables as something to be accomplished on a 100- to 200-year time scale, and one that must be accompanied by the holy grail storage solution(s).

    You’re right about subsidies, but I’d also note that land-based wind turbines now beat coal and nuclear on a kWh for kWh basis. But that “assumes the grid,” and as these things become non-trivial (especially wind, now at 4% of U.S. generation), one can no longer “assume the grid.” In the end, it’s all about the science and the engineering, and letting the chips fall where they may. Today is today, but tomorrow will be different.

  201. One other thing. Yes, hydro is “more dependable,” but it’s still classified by the Dept. of Energy as “non dispatchable,” with the proviso that it can be dispatched “within a season.” I can’t help but think that solar would fall in a similar category, being predictable enough even without storage to be “dispatched at certain times of day.” Surely more predictable than wind, wouldn’t you agree?

    I look at the American Southwest, and see lots and lots of roof space. As PV cost-per-watt continues to drop toward a point (I expect by 2025, if not sooner) at which subsidies will no longer be necessary, my going-in position is that there’s a strong argument for equipping the rooftops of Las Vegas, San Diego, Riverside, and Tucson with PV panels over time.

    When I talk to the enviro types about these things, I continually find myself telling them that there isn’t a magic bullet, that our energy comes from a variety of sources now (about 85% fossil and uranium), and that it’s going to remain this way forever, and that any replacement of extraction-based methods will take MUCH longer than they think it will. Even if someday, after we’re all dead, a future society generates 100% of its electricity from renewable sources, there will be a variety of them.

  202. Finally (for now), there are subsidies and then there are subsidies. Here in Washington State, they subsidize solar panels at 8:1 relative to RETAIL electricity rates. I think this is beyond absurd, well into lunatic territory. Same goes for Germany, which I assume has done this to placate their Greens.

    But here in America, we have the Southwest, and it’s big and sunny and far enough south. The fact that Seattle and Germany are full of nutcase progressives doesn’t indict solar. It indicts the innumeracy of nutcase progressives, that’s all.

  203. Jake, I think this thread has gone on long enough and was not intended as a seminar on electric utility planning. My final comments are:

    1. Dispatchability is a major factor in electric grid systems that react at lightspeed to imbalances. If you ran any time-dependent business, such as a ferry or taxi service, intermittent non-dispatchable operators would be of very limited use, as you would constantly have to arrange for back-up and/or lose business. Wind is virtually useless in grid applications, the coincidence of solar output and air-conditioning load in some areas does confer slightly more value on this variable resource but it is still highly variable, uncertain and non-dispatchable and absurdly expensive. You cannot run 24 hour process plants on intermittent sources. Don’t believe me? Try running a wind or solar powered ferry business – I’m sure there will be an academic study that tells us it is feasible.

    2. Run-of-river Hydro ( with no storage dam) was recently the darling of the green movement as it causes minimal disruption to streamflow and fish stocks. It is not dispatchable however – which is maybe why Hydro is classed as non-dispatchable in the referenced report. Large Hydro with multi-year storage dams ( think Hoover dam) are eminently dispatchable but expensive, and cause significant environmental disruption. There are few remaining sites in North America where large storage dams could still be built, and they would meet with XL pipeline-like opposition.

    3. I am not aware of any detailed reports on the real costs of integrating intermittent renewable resources into grid systems. The reason is simple. The only people that fully understand these costs are the electrical engineers who plan and operate real-life utility grid systems. They would lose their jobs if they told the truth about these costs in an environment where utilities are dependent on political favours to remain viable, and it is politically incorrect to be seen as negative in any way about renewables. You are only going to hear about these problems when these engineers retire, and as the cost of electricity soars in places like Germany, Denmark and the UK where they have gone overboard with renewable nonsense. I know this because I am one of those (semi)retired engineers.

    4. Sustainability and weaning ourselves off of a finite fuel supply is a no-brainer. So is the observation that we have 200 – 300 years to do this. What is the gadarene rush? I’m sure that 200 years from now ( if the human race has survived far more significant hazards than climate change) we will have sustainable energy in the form of 5th generation nuclear (fission or fusion), sustainable bio-mass and sustainable natural gas/hydrocarbon supplies ( from garbage etc) and who knows what else. There is no need for Quixotic wind-turbines or solar panels, and certainly no need this century to do anything more than research novel sources.

    Richard

  204. We’ve talked this much. I see no reason to stop, but I suppose if there are no replies I’ll stop.

    I don’t see how solar is as “highly variable” as you portray it to be. Seems to me that it’s very much the other way, as long as we’re talking about habitually sunny places. I wouldn’t call it “dispatchable,” but surely a portion of it is. I would expect that a portion of hydro would also be dispatchable, but I wouldn’t stake my life on it.

    Even if we have to wait 100 or 200 years to completely move away from extracted fuels, I expect that the process with happen by increments. I don’t see anything wrong with having subsidized wind and solar thus far. We subsidize lots of things; the question is what the return on the subsidy might or might not be. I’m pretty confident in the returns on wind and solar.

    I’m not nearly as confident on the return on the $4 billion we’ve already sunk into fusion, much less what’s coming in future subsidies. And I don’t think garbage methane is ever going to be more than the sort of cute boutique project of the kind that the progressive worthies of Seattle go apeshit for. e seen

    I think one point on which we do agree is storage. This is the holy grail, and the question will be how much it costs/kWh. I am not high at all on stored hydro, from what I’ve seen. My hopes are in new batteries, a technology that’s pretty much drifted in the engineering backwaters for a long time. Now that we have electric cars in need of lower costs and higher energy density, and a call for grid scale storage, maybe we’ll see some investment dollars flow that way.

  205. Richard says:
    February 20, 2014 at 11:28 am

    4. Sustainability and weaning ourselves off of a finite fuel supply is a no-brainer. So is the observation that we have 200 – 300 years to do this. What is the gadarene rush?

    True dat … and I do love the phrase “gadarene rush”. Eloquent.

    w.

  206. Jake J says:
    February 19, 2014 at 6:51 pm

    One other thing. Yes, hydro is “more dependable,” but it’s still classified by the Dept. of Energy as “non dispatchable,” with the proviso that it can be dispatched “within a season.” I can’t help but think that solar would fall in a similar category, being predictable enough even without storage to be “dispatched at certain times of day.” Surely more predictable than wind, wouldn’t you agree?

    I look at the American Southwest, and see lots and lots of roof space. As PV cost-per-watt continues to drop toward a point (I expect by 2025, if not sooner) at which subsidies will no longer be necessary, my going-in position is that there’s a strong argument for equipping the rooftops of Las Vegas, San Diego, Riverside, and Tucson with PV panels over time.

    Don’t know if you remember, Jake, but back under Carter the government started subsidizing solar power. This was done with the idea that in a decade or so, solar would be cost-competitive with fossil fuels and wouldn’t need subsidies. And you know, for the first decade or so, I believed it myself.

    However, I gotta say that after FORTY YEARS OF TAXPAYER SUPPORT driven by the green fantasies of well-meaning fools, I busted out laughing when you said solar would be able to compete … in about a decade … if the taxpayers just keep up the subsidy. My response?

    Get your green greedy hands out of my wallet, and pay for it yourself.

    Next, you note that hydro is dispatchable maybe half the year. Let me add that during that half year it is available 24/7, and is rapidly adjustable from zero to full power production.

    Solar, on the other hand, is dispatchable about a third of the day, from about 8AM to 4PM. During that third of a day, the amount produced is not controllable or adjustable, rapidly or otherwise. Instead, it is subject to unpredictable major disruptions in production.

    As a result, your idea that they are comparable is simply not true. Hydro can be used to balance intermittent sources. Solar IS an intermittent source.

    Finally, roof-top and other solar is driving electricity costs … well … through the roof. When legislation forces the utilities to buy power from roof-top installations and large-scale installations at high costs, who do you think pays the bills? The poor bugger at the end of the power line, that’s you and me.

    I say cut them all loose, stop subsidizing them all, every one. The market sorted out the shift from wood to coal and whale-oil, and the shift from coal and whale-oil to petroleum, and the shift from coal to natural gas … let solar and wind sink or swim with the rest. There are certainly places for both … usually, really isolated places.

    w.

    • Excellent response, w…allow me to pile on. Solar in the desert southwest may be 8 to 4, but in the rest of the country its worse, someplaces much worse (think latitude). Here in Ohio I give you 11-2 on a clear day…with the further caveat that we are cloudier than the Pacific Northwest!

  207. During that third of a day, the amount produced is not controllable or adjustable, rapidly or otherwise. Instead, it is subject to unpredictable major disruptions in production.

    What, because the sun will go down?

    I say cut them all loose, stop subsidizing them all, every one. The market sorted out the shift from wood to coal and whale-oil, and the shift from coal and whale-oil to petroleum, and the shift from coal to natural gas … let solar and wind sink or swim with the rest. There are certainly places for both … usually, really isolated places.

    At the risk of sounding like one of righteous Seattle progressives who make me grind my teeth, there are in fact considerable subsidies for all of the extractive fuels. If, for example, we’d slapped a 70-cent a gallon tax at the pump on gas to pay for the Iraq and Afghanistan wars, I’d be more sympathetic to the jihad against “subsidies.”

    That much said, I view subsidies, whether they’re for the semiconductor industry in the 1950s, (what became the) Internet in the ’60s and ’70s, or solar since the ’00s, I view them as investments by a different mechanism. Some investments are stupid (Solyndra being a prime example) while others (the Marshall Plan, hotly opposed by the wingnuts of the day) make more sense.

    To me, fusion has been one of the bigger boondoggles out there, given that no one has ever even shown any sign of coming remotely close to solving the big issue, containment. Yet, for some reason, the gov’t keeps pouring money down that rat hole. But who knows, maybe it’ll pay off. Solar panels? Those are going to pay off in a big way. The Iraq war? Not so much.

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